Excise duty cut on STBs bring little cheer to local manufacturers

MUMBAI: The finance ministry's decision to notify a reduction in customs duty from 25 per cent to 5 per cent on key components of a set-top box -- tuners, remote control units and RF-modulators - in addition to abolishing excise duty on set-top boxes (STBs) has upset local manufacturers. There is a feeling that locals who make these items for television and perhaps telecom equipment will be hit because imports of these components will be cheaper than local manufacture, in the absence of countervailing duty on the import.


Broadband Pacenet (India) CEO S Ravindran reacts by saying: "Considering the estimated demand of 40 million boxes, the only way the government can give a boost to the local Indian industry is if the IPR for the design of the box and CAS is held in India. Otherwise, import is cheaper and the government will only play into the hands of foreign manufacturers. The moot point is that the box and CAS are integral units - that is why STBs can be rented (avoiding sales tax) because the box is part of the plant controlled by CAS."


Experts are also critical of the fact that the ministry has not exempted the key components from excise duty. Sanjiv Narayan, president, Electronics Component Industry Association (Elcina), was quoted in a leading business daily as saying that if the components manufactured locally carry a 16 per cent excise duty but there is no excise duty on a finished STB, there is no set off for the manufacturer and the value-addition chain is broken.

HTMT group director and CTO KV Seshasayee says that the situation will not be clear until notiifcation comes through. "There is no excise duty if these items are imported - the components are not sold to customers. Presently these componenets are not made in India. ELCINA should be able to get clarification from the Ministry that if they supply these items locally, the STB manufacturer should be able to claim drawback on this, or the tuner manufacturer should be excise exempt when delivering to STB vendor. The remote control units are already made in India, and costs are comparable," he adds.

Seshasayee also adds: "These are operational matters which component manufacturers have to work out with government. We as MSOs can help in the process."

Broadband's Ravindran also feels that the government's strategy is anti-consumer. "The royalty on CAS can be calculated at $10/box and smart cards are replaced every year and cost $4. These will be continuous outflows and the subscriber will have to bear this cost. Certainly the government is not endeavouring to make it consumer friendly as other countries have done. In China, the government has made Chinacrypt as standard--so consumer gets flexibility and the government gets security. "

According to industry sources, manufacturers in China are able to supply globally because domestic policy allows them to manufacture locally for exports as well as domestic consumption.

Asked to comment on the government's latest effort to get STBs moving in the market and the reaction of local manufacturers, HTMT group director and CTO KV Seshasayee said the situation would only be clear after the government notification came through.

He however made two points. The first being that there is no excise duty if these items are imported (the components are not sold to customers).

And referring specifically to the complaints made by local manufactuerers, Seshasayee said, "Presently these componenets are not made in India. Elcina should be able to get a clarification from the ministry that if they supply these items locally, the STB manufacturer should be able to claim a drawback on this, or the tuner manufacturer should be excise exempt when delivering to STB vendor. Remote control units are already made in India, and costs are comparable."

Latest Reads
Leadership secrets & wisdom from Viacom18

Earlier this year during the thick of the lockdown due to the pandemic, Viacom18 CEO Sudhanshu Vats announced that he was moving on from the organisation he headed for around eight years. Earlier, in 2019, his deputy COO Raj Nayak too departed from a company he was associated with for seven years.

Television TV Channels Viewership
Ten brands partner with season 12 of Kaun Banega Crorepati

MUMBAI: Celebrating two decades of unparalleled success and popularity, Kaun Banega Crorepati not only emerged as a game-changer for the Indian television industry but also instilled a larger focus on the power of knowledge being a great leveler. In its twelfth season, the show makes a comeback...

Television TV Channels GECs
Chrome DM week 37: English Movie emerges as top gainer

MUMBAI: After seeing a marginal growth in week 36, various genres in the broadcasting segment have witnessed noticeable growth in week 37. English movie genre has become the top gainer in week 37, 2020 of Chrome Data Analytics and Media data. The genre has grown by 2.57 per cent. Among English...

Television TV Channels Viewership
Pad Up For An Innings Of Unrivalled Thrills As &flix Presents Flix Movie League

The much-awaited moment has arrived as one of the biggest sporting leagues finally takes centre stage. But that’s not all! As you welcome back your beloved cricketers on field, it’s also time to root for your favourite heroes on screen with Flix Movie League on &flix. The stage is set for the...

Television TV Channels English Entertainment
Enterr10 Television strengthens its Bhojpuri play with Enterr10 Rangeela

MUMBAI: In a bid to expand its presence across India and strengthen its foothold in existing markets, leading broadcaster Enterr10 Television announces the launch Enterr10 Rangeela, its second offering in the Bhojpuri region. Enterr10 Rangeela is a Bhojpuri language General Entertainment Channel....

Television TV Channels Movie Channels
Now you see him…now you don’t - the Invisible Hero,

MUMBAI: Sony SAB is all set to enthral the audience with the launch of its brand new offering 'Hero - Gayab Mode On'. The show slated for release in November is one of its kind and the first-ever show on Indian television that brings the best of science fiction and mythology together, where the...

Television TV Channels GECs
Saregama launches Carvaan Malayalam

MUMBAI: After weaving in a nostalgic music experience for its Hindi, Tamil, Punjabi, Bengali and Marathi music lovers, Saregama launches Carvaan Malayalam with pre-loaded 5000 evergreen songs classified into artistes, devotional and carnatic.

Television Production House Post Production
RuPaul wins best reality host for fifth year in a row

RuPaul won for outstanding host for a reality or competition program at Creative Arts Emmys, breaking Jeff Probst's previous record for wins in the category with a fifth straight Emmy.

Television TV Shows Awards

Sign up for our Newsletter

subscribe for latest stories

* indicates required