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In a bid to reduce imports and promote domestic manufacturing, the Centre has made a list of 35 items on which the customs duty is likely to be increased in the upcoming Budget, a report by the Economic Times (ET) said. It includes items like private jets, helicopters, high-end electronic items, plastic goods, jewellery, high-gloss paper and vitamins.
“A list has been drawn up based on the inputs from various ministries that are being examined,” an official told ET.
The government has also reportedly issued quality control orders to curb the imports of these non-essential items. “Goods already being manufactured in the country are being considered,” the official added.
In December, the Ministry of Commerce and Industry asked various ministries to make a list of imported non-essential items that can be considered for tariff hikes. The Centre has been cautious about the current account deficit, which rose to a nine-month high in the quarter ending September to 4.4 per cent. Deloitte, in a report released last week, said that it might worsen further.
Apart from the risk of a high import bill, the exports may also face pressure in FY24.
“With local demand set to outpace export growth, the merchandise trade deficit could remain at $25 billion per month, translating into a CAD of 3.2-3.4 per cent of GDP,” ICRA chief economist Aditi Nayar told ET.
The move to increase the customs duty is also aimed at strengthening the Centre’s ‘Make in India’ programme, which was launched in 2014.
In Budget 2023, too, the Centre hiked import tariffs on several items like imitation jewellery, umbrellas and earphones.
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