Union Budget 2025: Laptops with touch sensitive displays to cost more, smart TVs expected to go cheaper

Union Finance Minister Nirmala Sitharaman on Saturday (February 1, 2025) announced to increase the basic customs duty (BCD) on interactive flat panel display (IFPD) or touch sensitive display to 20% from the current 10% and simultaneously reducing the duty to 5% on open cell and other components.

The proposed changes might increase the bill of materials (BOM) for the laptops that ship with touch sensitive displays and other flat touch screens used for advertising.

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However, the open cell duty cut can help OEMs in lowering the cost of the smart televisions for the public.

“In 2023 -24 Budget, for the manufacture of Open Cells of LCD/LED TVs, I had reduced the BCD on parts of Open Cells from 5% to 2.5%. To further boost the manufacture of such Open Cells, the BCD on these parts will now stand exempted,” the FM said while presenting the Union Budget 2025.

She also proposed to add 35 additional capital goods for EV battery manufacturing, and 28 additional capital goods for mobile phone battery manufacturing. “This will boost domestic manufacture of lithium-ion battery, both for mobile phones and electric vehicles,” she added.

If the localisation of lithium-ion battery will increase, it can cut the time-to-the-market and may help in minor correction of the overall cost of a phone or an EV.

“The recent revision in Basic Custom Duty (BCD) clearly indicates the government’s intent to promote domestic manufacturing of interactive panels, with the duty increasing from 10% to 20%. While this is a positive move, a major breakthrough has been the reduction of BCD on OpenCell and its components from 2.5% to 0%. However, this policy change currently benefits only one bonding facility in India, creating an unequal playing field for other panel manufacturers,” said Avneet Singh Marwah, CEO SPPL, which makes smart TVs for Kodak, Thomson, Blaupunkt, White-Westinghouse, and JVC.

Mr. Marwah said that the fundamental challenge remains the scarcity of raw materials—even if new investors set up bonding plants, they will not gain any advantage due to limited access to OpenCell. The existing bonding facility that benefits from the 0% duty exemption is linked to an OpenCell manufacturing plant in China, further deepening India’s dependence on China for critical display components.

He said that, globally there are only five OpenCell manufacturers, with three to four of them having their own retail brands, making the supply chain even more restrictive.

“Unless India develops its own OpenCell ecosystem, new investments in bonding plants will not yield significant benefits. The government must take immediate steps to diversify raw material sourcing and attract OpenCell manufacturing to India,” Mr. Marwah added.

“The decision to increase the basic customs duty on interactive flat panel displays is a crucial step in addressing the inverted duty structure. This move will foster local manufacturing and support the growing demand for advanced educational technologies,” said Rajeev Singh, MD, BenQ India and South Asia.

All India Mobile Retailers Association (AIMRA) Chairman Kailash Lakhyani said that with no income tax till ₹12 lakh, people will have more income in hand to spend and so does the small retailers who needed incentives for their business. “This move of increasing the income tax exemption limit will provide tremendous impetus to domestic demand and consumption,” he added.

“Reducing BCD to 5% on open cell components and including 28 additional capital goods for mobile battery fabrication will strengthen local manufacturing and further generate employment in the sector,” said Ravi Kunwar, VP and CEO, HMD India and APAC.

Arijeet Talapatra, CEO of Itel and Tecno, said, “The proposed tariff reductions on essential assembly components—such as PCBAs, camera modules, USB cables, and display modules—are a welcome measure that will improve cost efficiencies, accelerate localization, and strengthen the Make in India initiative. This move strengthens India’s position in the global supply chain, especially amidst shifting trade dynamics amongst major economies.”