Smartphone Prices: Why Budget 2024’s Duty Cut Won’t Translate to Lower Costs for Consumers
Budget 2024’s customs duty cut on smartphones may not lower prices much for consumers due to ongoing inflation and high production costs.
Why the Duty Cut in Budget 2024 Won’t Significantly Reduce Smartphone Prices for Indian Consumers
Unfortunately, the latest Budget 2024 did not write a positive future for Indian smartphone consumers even though there were small positive signals for the sector. As for the expectations of decreasing the smartphone prices after cutting the duty, it seems that consumers are not likely to have much of an improvement.
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Some sources within the industry indicate that the changes in the BCD for mobile phones and the components of Smartphones are not going to result in a dramatic effect on its prices. This duty mostly impacts phones that are imported into the country, meaning brands like Apple and Google must import their hardware into the country for sale locally. Essentially, Tarun Pathak of Counterpoint Research for mobile technology says that smartphone prices could likely drop only by about 1 to 2% as initially expected. However, this is only if OEMs decide to help the consumer by lowering their prices due to these increased efficiency levels.
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https://m.economictimes.com/news/economy/policy/budget-2024-good-news-for-mobile-phone-buyers-as-sitharaman-announces-15-duty-cut/videoshow/111952581.cms
There is an increasing demand for reasonably priced apps, including applications for the iPhone 15 Pro and the Google Pixel 8 Pro while most users prioritize cost and mid-range devices. As Mohammad Faisal Ali Kawoosa, the founder of Techarc pointed out, the current industry trend of pushing more of the higher end models may not be sustainable. While there is scarcely any policy idea, which Stephen can support, that could accelerate the availability of affordable 5G mobile devices to the bulk of consumers.
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Although authorities cut the duty from 20% to 15%, one must remember that inflations remain high and raw materials remain expensive, which may keep the effect of this measure in check and prevent end-user prices from being lowered significantly. Analysts had expected even more significant and slab-wise alterations to duties with a view to drive the evolution of affordable 5G devices. While the government targets the growth of ‘Make in India’ and changes India into an export hub for multinational IT companies, the postponement of the incoming financial assistance for consumers does not offer an extensive response.
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