The domestic television industry and the domestic component manufacturers are set to lock horns over their recommendations for the Union budget 1998-99.
Consumer Electronics and TV Manufacturers Association (Cetma) has suggested a reduction in customs duty on components to boost the consumer electronics segment.
This demand is in conflict with the position of Elcina, the association of component manufacturers which is currently preparing its recommendations.
Cetma has asked for a cut in the duty on colour picture tubes from the existing 30 per cent to 20 per cent which will enable the domestic television manufacturers to reduce costs of picture tubes.
It has sought a duty protection on finished products including colour televisions by proposing an imposition of countervailing duty over and above the existing 40 per cent duty on consumer electronic goods, electronic home appliances and white goods.
Predictably, the domestic CPT manufacturers like JCT Electronics and Samtel have opposed any reduction in customs duty on picture tubes from the current rate of 30 per cent.
They say that the existing duty structure just enables them to price their products competitively with imports, and that any further lowering should be done only at a later date, and that status-quo should be maintained if not an increase in the tariff protection.
The other recommendations by Cetma include reduction in customs duty of electronic watch module from 25 per cent to 20 per cent and its components from 25 per cent to 10 per cent, plastics from 30 per cent to 10 per cent, copper wire from 30 per cent to 10 per cent, components and accessories of calculators from 40 per cent to 20 per cent, and aluminium bars, rods and profiles from 20 per cent to 10 per cent.
Cetma has also sought relief on the excise duty front seeking a slashing of rates for all consumer electronics products including colour televisions (from 18 per cent to 13 per cent), black & white televisions (from 13 per cent to 8 per cent, VCRs/VCPs and CD players (from 18 per cent to 13 per cent).
Cetma, in its recommendations, has stated that these tariff corrections are necessary to boost demand by effecting price reductions.
With these changes, the association has projected a good chances of recovery in the industry with 20-25 per cent rate of growth in colour television, up to 5 per cent in black&white TV and 10-15 per cent in audio products.
