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Handset prices to dip

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CIOL Bureau
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NEW DELHI: In line with its commitment to the government of India, Indian Cellular Association (ICA) members have announced the passing of duty rationalization benefit to the consumers of the country.

All this is being done as a result of Indian government’s announcement of mini-budget, where it abolished four per cent special duty and reduced basic customs duty from 10 percent to five percent.





"We are quite pleased by government’s decision of rationalizing the customs duty and abolishing SAD on mobile cellular handsets. The new duty structure will make it a level playing field for manufacturers. The grey market has already come down to around 55 per cent and we are expecting this to further go down to around 20 percent to 25 percent in the coming year," informed ICA national president, Pankaj Mohindroo.





Collectively taking a hit of around Rs 20 crore, the ICA members including Alcatel, Nokia, Samsung and Motorola have reduced the MRP of mobile handsets by an average 7.5 percent. "Now we can say that Nokia is cheaper in India than in Finland and similarly Samsung handset is cheaper in India when compared to its Korean pricing," he said.





At a time when the government is trying hard to increase the tele-density of the country, this move will go a long way in achieving that goal. "At present the mobile tele-density of the country is hovering at around 2.5 percent and by the end of year 2005 we are expecting to push this figure to nine percent. In the process we are likely to sell 100 million handsets by the end of year 2005," Mohindroo added.





In the year 2003, the overall handset market (GSM + CDMA) was around $1.4 billion and this figure is likely to reach the $ 2.5 billion mark. "The industry is doing pretty well and we are expecting that 16.9 million GSM and 11.8 million CDMA handsets will be sold in the year 2004," Mohindroo informed.



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