In a move that has significance for the TV industry in India, the Indian Government announced on July 10th that, effective immediately, import duties on CRT TV picture tubes as well as displays and other components used to manufacture flat panel TVs under 19” are now exempted from import duty. The import duty for both had been 10%. The moves by the government were made to ensure that disadvantaged populations are not left out of the entertainment market, by ensuring all income levels of buyers access to TVs at rational prices.
The elimination of these import duties could give an additional lease on life to CRTTV in India. Indian companies such as Videocon, Onida and few other local manufacturers have had a substantial stake in manufacturing CRTTVs and are the primary suppliers as of early 2014. Videocon has an established supply line from the only functional CRTTV producing line in China. There is still some demand for CRTTV due to the price difference with LCD TV, although our latest forecast shows shipments of CRT TVs in India winding down to zero by the end of 2015. This move could lead to some upside potential in the forecast, though the impact on market pricing versus profits for the manufacturers needs to be seen.
A very significant fall in prices is not likely, since the CRT TV supply chain is stressed, and prices are under pressure, so the elimination of duties will allow brands in this business to hold their current prices. Because prices will in effect be stabilized, there will be some positive impact on total revenues. Although flat panel TV sales are growing, the decline in demand for CRT TVs has been greater, so the total India TV market has been in decline for over a year.
This also ends an anomaly in taxation as monitor panels, which are generally under 19”, are already duty free. India could become an export hub for southwest Asia if more manufacturing is located in India.