Duty hike on imported medical devices to boost manufacturing
To encourage domestic manufacturing, the government has increased the rate of basic customs duty levied on the import of certain medical equipment from 5% to 7.5% and imposed special additional customs duty (SAD) of 4% on such items. The duty has been revised on the basis of recommendations of a task force which was constituted to examine various issues concerned with the domestic medical devices sector. “Taking into consideration the recommendations of the task force, the government has increased the rate of basic customs duty on certain specified medical device from 5% to 7.5%. Simultaneously, the exemption from additional customs duty (SAD) on these medical devices has also been withdrawn, and they will now attract 4% SAD,” a Finance Ministry statement said on Tuesday. Also to give fillip to indigenous manufacturing, the government has reduced the customs duty to 2.5% on the import of raw material, parts and accessories and allowed exemption from SAD on these products traded under HS Codes 9018 to 9022. “These changes are expected to provide impetuous to the domestic medical devices sector, support make in India campaign of the government and generate employment,” the statement said. However, the concessional basic customs duty will be implemented on hospital equipment for use in hospitals run by central or state governments or registered societies, and specified assistive devices, rehabilitation aids and other goods for disabled. Experts say that despite producing diverse range of products and having huge export potential, India majorly depends on imports to meet the requirement of high-end equipment. As per the Commerce Ministry data, during April-September 2015-16 period, India exported medical devices (covered under HS Codes 9018-9022) worth around $430 million, while the country’s imports of these items crossed $1,200 million.
January 20, 2016 | 01:10pm IST
to success.