India views its decision to impose specific regulations on the import of IT hardware, such as laptops and personal computers, as a security measure rather than a trade-related consideration. This action is in response to concerns raised by various nations, including the United States, China, South Korea, and Taiwan, during a recent World Trade Organization (WTO) meeting.
An unnamed senior government official stated, “The WTO is not an appropriate platform for discussing security matters, and our measures to scrutinize imports of laptops and personal computers primarily stem from security and safety concerns. We will clarify this during the upcoming meeting.”
In August, the government initially attempted to mandate licensing requirements for laptop and personal computer imports but postponed the implementation until October 31 due to strong opposition from the industry. They have subsequently been developing a new approach known as the ‘import management system.’ This system will require IT hardware companies to register and provide information about their imports and their source countries. However, the previously proposed quota system will not be immediately enforced, offering some relief to the industry.
However, the government has not officially released this policy, and the August 3 notification that postponed the implementation of licensing norms has yet to be formally rescinded.
During a meeting of the WTO’s Committee on Market Access on October 16, the United States expressed concerns about the impact of these measures on trade, including US exports to India, once they are enacted. The US also highlighted the uncertainty these measures create for exporters and downstream users.
South Korea argued that India’s proposed measures seemed inconsistent with WTO rules and could potentially create unwarranted trade barriers. They called on India to reconsider the implementation of these measures and provide detailed information, including the timeline for their enforcement.
Another senior government official stated that the concerns raised by these countries will be addressed within the WTO. However, they stressed that objections are premature since the policy for laptop imports is not yet in place. The official also highlighted that, considering the initial concerns related to national security that prompted these restrictions, India’s actions should not be held against it, as other countries are also adjusting their policies in line with their national interests. The official noted, “Countries frequently raise concerns at the WTO, and India has previously raised concerns about various issues from other countries. However, this matter is unlikely to escalate into a dispute since the policy has not been implemented yet. In this era, when every country is prioritizing its security concerns, India made this decision based on its own national security concerns. There were concerns about specific laptop models and how they handled data storage.”