India Extends Import Management System for IT Hardware Until December 31, 2024

India has extended its import management system for laptops and other IT hardware products until December 31, 2024, with new import approvals required starting January 1, 2025, based on revised guidelines.

The Directorate General of Foreign Trade (DGFT) announced the extension of the current import management system (IMS) for IT hardware products by three months, as outlined in a policy circular issued on September 24, 2024. Initially set to expire on September 30, 2024, the IMS will now continue until the end of the year.

Introduced on November 1, 2023, the IMS aims to promote domestic manufacturing, reduce reliance on foreign suppliers (such as China), and ensure a secure electronics supply chain into the country. The system covers import of products like laptops, tablets, all-in-one personal computers, ultra-small form factor computers, and servers.

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The extension comes amid concerns about India’s still-developing domestic IT hardware manufacturing ecosystem. According to several media reports, discussions were being held at the ministerial level about extending the system, as India’s local production capacity of electronic components is not yet fully established.

Initially, India’s central government had planned to implement an import licensing system for IT hardware in August 2022. However, after facing opposition from companies, industry groups, and trade partners, India opted for a fully online, “contactless” IMS in November 2023. This move was in response to demands from industry players struggling with the new import authorization regime.

Industry stakeholders call for clarity on 2025 import authorization scheme

Despite the latest announcement on the extension of IMS, some industry leaders have expressed concerns about the forthcoming changes and stressed the need for more clarity on the new import authorization scheme set to take effect in 2025. They are also calling for thorough stakeholder consultations before implementing any new regulations.

Meanwhile, Ajay Srivastava, founder of the Global Trade Research Initiative (GTRI) and former trade ministry official, has emphasized the necessity of enforcing these restrictions to foster local manufacturing. He suggested that the policy could prompt major U.S. tech companies, such as Apple, Dell, and HP, to relocate operations from China to India. The GTRI founder believes that although China controls a significant share of the global PC and laptop production market, India has a strong case for developing its own manufacturing capabilities.

How the Import Management System (IMS) works

The Import Management System (IMS) aims to simplify the import process by ensuring compliance with laws, maintaining accurate documentation, and facilitating efficient customs clearance. Key components of an IMS include regulatory adherence, proper documentation, tariff classification, and the use of customs brokerage services. It also emphasizes financial security through trade financing and risk management to prevent disruptions.

In November 2023, India introduced the system that required businesses to register the quantity and value of their laptop and tablet imports with the central government. This data would be monitored to manage import levels and enhance domestic manufacturing efforts.

The DGFT, responsible for overseeing India’s foreign trade policy, plays a central role in this process. The IMS can be integrated with the DGFT Portal, allowing importers to apply for licenses and permits online, track applications, and receive approvals electronically. This integration reduces administrative burden and speeds up the import process, helping businesses stay compliant with the latest regulations and policies.

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