India’s “Import Management System” to Restrict IT Hardware Imports from China

September 5, 2023

Amid tensions between India and China and growing concerns about import dependency, India is considering a new “import management system” for IT hardware. Under this system, finished IT hardware like laptops, personal computers, and servers could only be imported from “trusted geographies,” effectively targeting imports from China.

Why is India considering the “import management system” for IT hardware imports?

India is considering this system to reduce its import dependency on China and diversify supply chains for IT hardware while still fostering domestic production. The move aligns with India’s broader goal of becoming self-reliant in electronics production and become an electronics manufacturing hub.

How does the “import management system” differ from the previously proposed licensing requirement?

Previously, the Directorate General of Foreign Trade had announced a requirement for companies to obtain licenses for importing such devices, but it faced backlash and is now being replaced by this new approach. The “import management system” differs from the previous licensing requirement as it focuses on importing finished IT hardware from “trusted geographies” rather than imposing a licensing process. It aims to encourage companies to source their IT hardware from regions other than China.

What other sector in India has employed a similar strategy to restrict imports from China?

The telecom sector in India has implemented a similar strategy with the “trusted telecom portal” and the National Security Directive on Telecommunication Sector (NSDTS). Telecom companies are required to use “trusted products” from “trusted sources” in their networks, excluding Chinese companies.

What is the significance of India’s imports of electronic goods and laptops/computers from China?

India’s imports of electronic goods and laptops/computers from China have increased in recent years, making it an area of high import dependency. China accounts for a significant portion of India’s imports in this category, which has raised concerns about over-reliance on Chinese imports in the IT sector.

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