Government's Message To Samsung About Its 'Make In India' Initiative

Saanvi Araav - Aug 13, 2019


Government's Message To Samsung About Its 'Make In India' Initiative

The Indian government expresses its stance on the recent decision of Samsung stop its LED televisions manufacturing in India.

A committee on electronics organized by the Prime Minister's office has expressed their concern about the decision of Samsung Electronics to stop its LED televisions manufacturing in India. They also want the company from South Korea to commit to its ‘Make in India’ scheme.

The customs duty

Samsung Electronics has stopped its TV production at the Chennai plant back in October of last year. That was mainly due to the 5 percent customs duty imposed on the open cell panels. An open-cell panel is a crucial component which accounts for about 65-75 percent of a TV's total production cost. The company has chosen Vietnam as a destination for its TVs import via the free trade agreement route in order to avoid customs duty.

Governments Message To Samsung About The Matter Of
Samsung has stopped its TV production at the Chennai plant.

The company responded that it would restart the TV set and LED TV panel production in Chennai if the Indian government removed the duty on open cell panels, according to senior executives in the industry. The company has conveyed its decision to the government committee at a meeting earlier in July in New Delhi, and also via a letter after that.

A certain executive said that the committee from the Indian government had expressed that the decision of Samsung to move its TV production over to Vietnam is a big blotch on the initiative of  ‘Make in India’. The committee wants Samsung to remain committed.

TV imports

Data from the government shows that TV imports from Vietnam have increased massively from Rs 62 crore last year to Rs 2,317 crore this FY19. It is likely that Samsung Electronics alone accounts for this increase in TV imports since it has production plants there.

Governments Message To Samsung About The Matter Of
The committee wants Samsung to remain committed to its initiative.

On the other hand, Samsung wants to increase its production of mobile phones in India via contract manufacturing. It is also going to sign a new deal with a certain Indian manufacturer to produce feature phones and with Wistron Corporation from Taiwan to make smartphones.

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