Government to banish unbranded mobile phones

By siliconindia   |   Wednesday, 14 July 2010, 21:50 IST
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New Delhi: Sale of unbranded mobile causes revenue loss for the government as it is buckled with pressure from the high-end mobile manufacturers. As the World Trade Organisation (WTO), does not have any rules regarding the permission to ban commodities like unbranded mobiles, Telecom Minister A. Raja has asked the ministry to look into the matter and come out with effective implementation at the ground level, reports Sanjay Singh, India Today. These unbranded mobiles do not generate any revenue for the exchequer as they are largely smuggled. The selling of the unbranded mobiles cost Nokia a great deal as its sales came down to Rs 14,100 crore in 2009- 10 from Rs 16,567 crore in the previous fiscal. The purchase of unbranded Chinese mobile phones at Rs 4,200 crore in 2009-10 emanated in a humongous revenue loss for the government in terms of non-payment of value added tax (VAT), Octroi and entry tax. The telecom ministry has contradictory views regarding the ban, "How can you ban a commodity which is available in the grey market? It is not an easy task. You have other international restrictions like WTO too, According to a top telecom ministry official, "There are issues concerning security, revenues and poor quality of services by those selling unbranded mobiles, which are good enough reasons for any state to impose a ban on the product," The ministry plans to propose the Package Commodity Rules for productive execution of the ban on unbranded mobiles, especially coming to India via China. Pankaj Mohindroo, President of ICA (Indian Cellular Association) said that as far as the security of the country is concerned it will make sure that people are protected from the dangers of unbranded mobiles. He said, "It is a serious issue (sale of unbranded mobiles in India). If there is no check on such sales it would have serious implications." The concept regarding the ban may just remain a thought as there are various constraints.