Lowering GST could expand digital economy, says Indian mobile association

The India Cellular and Electronics Association (ICEA) has called for a drastic reduction in GST on mobile devices, proposing a shift from the existing 18 percent to just five percent. The association stresses that smartphones have evolved beyond simple communication tools to become essential gateways for digital payments, government services, learning, healthcare, and financial inclusion.

With roughly 250 million citizens still using feature phones, the high price of smartphones acts as a barrier to broader digital participation. A reduced tax rate would lower purchase costs, stimulate first‑time ownership, and drive deeper integration of citizens into the formal digital economy.

ICEA cited impressive growth in the manufacturing sector, with the industry's worth projected to rise from about ₹18,900 crore in FY 2014‑15 to over ₹6.27 lakh crore by FY 2025‑26, and exports climbing to ₹2.60 lakh crore. Despite these gains, domestic handset demand remains subdued, with longer replacement cycles and pressure on the low‑end segment.

The association warned that without a tax incentive, the next wave of growth in production could stall, undermining India's ambition to become a global hub for handset and component manufacturing.