Government Imposes Import Restrictions on Laptops, Tablets, and Servers

• ByStartupStory     |    August 4, 2023

The government has taken measures to address security concerns and boost domestic manufacturing by imposing restrictions on the import of laptops, tablets, all-in-one personal computers, ultra-small form factor computers, and servers. These restrictions, recently notified by the Directorate General of Foreign Trade, require imports to be allowed only with valid import licenses. The move allows the government to closely monitor imports, particularly from China, and regulate inflows as necessary.

However, it is important to note that there are exemptions to these import restrictions, such as imports under “Baggage Rules” for international travelers. The primary intention behind these restrictions is not to completely bar imports but to ensure that imported items, falling under HSN 8741 comply with India’s security standards and do not pose risks to consumers. Such measures are permissible under World Trade Organization (WTO) norms, as members are allowed to implement policies addressing their security concerns.  “The idea behind the import restrictions (on items falling under HSN 8741) is not to bar imports but to regulate it to ensure that items that come into the country are compliant with India’s security concerns and don’t expose consumers to any risks,” an official source told to media outlet.

These are not in violation of WTO norms, as the multilateral body allows members to put in place policies that address their security concerns, he added. “Keeping in view that some of the imported hardware could potentially have security-related issues and compromise the sensitive and personal data of users, it is important to source them from trusted and reliable partners. The safety of Indian citizens is the topmost priority,” the source said.

The government’s concern stems from the potential security threats posed by certain imported hardware that could compromise the sensitive and personal data of users. Therefore, it is essential to source such items from trustworthy and reliable partners to prioritize the safety of Indian citizens.

Although the import restrictions are not explicitly country-specific, they are likely to affect imports from China significantly, given that China accounts for a considerable portion of the $7 billion worth of annual imports of the restricted items.

The move would also give a leg-up to domestic manufacturers, including investors under the production-linked incentive scheme, the source said. “A lot of MNCs have also set up manufacturing bases in India in the IT and electronics sectors. We hope that our domestic manufacturing is also able to cater to our needs,” he added.

The notification is already in effect, but there are transition provisions in the foreign trade policy. Import consignments with an issued bill of lading and letter of credit before August 3 can be imported without a license until August 31. However, after that date, importers will need to obtain licenses for restricted items.

“The import licensing portal is active. A few more columns may be required specifically for IT hardware, which will be done in a day or two,” the source said.

The government has provided exemptions from import licensing requirements for various scenarios, such as imports under baggage rules and certain quantities for R&D, testing, benchmarking, evaluation, repair, re-export, and product development purposes.

“Over and above this, exemptions from import licensing requirements are also provided for the import of one laptop, tablet, personal computer, or ultra-small form factor computer, including those purchased from e-commerce portals, post, or courier,” the source said. 

Additionally, items that are an integral part of a capital good, like a machine embedded with a computer, are exempt from import licensing requirements. Furthermore, for the re-import of goods repaired abroad, a license for restricted imports is not required for the repair and return of the items.

The import licensing portal has been made active, and specific columns for IT hardware will be added shortly. The government aims to strike a balance between regulating imports for security reasons and promoting domestic manufacturing while ensuring that genuine needs are met with reasonable exemptions.

Follow Startup Story