News Excerpt:

The Indian government recently rolled back the laptop licensing policy after pressure from US officials.

About the Policy and Reversal:

• In August 2023, India's Directorate General of Foreign Trade (DGFT) implemented a licencing policy that requires firms such as Apple, Dell, and HP to seek licences before importing laptops, tablets, PCs, and servers. 
• However, the Indian government chose to reverse this stance after being criticized by US officials, particularly the US Trade Representative. 
• The decision to repeal the licencing requirement was motivated by diplomatic negotiations and worries about the impact on business settings.

Impact of reversal:

• The reversal of the laptop licencing policy exemplifies the delicate balance between regulatory measures and international trade ties. 
• While the Indian government claims that the decision was based on local manufacturing needs, it highlights the complexities of global trade discussions. 
• Moving ahead, ongoing trade policy monitoring and adherence to international responsibilities will be critical to ensuring a stable and accommodating business environment.

USA’s view on India’s laptop licensing policy:

• U.S. firms perceived the move as highly protectionist and out of sync with India's progress in improving the investment environment.
• India has taken several decisions that have hit American firms—like forcing Mastercard and Visa to store data locally and forcing Amazon to open a new tab to comply with stringent rules for e-commerce, which once disrupted its operations.
• US officials expressed ongoing worries about India's "out-of-the-blue" policy changes, which they argue create an uncertain business environment.
• They highlighted the adverse impact on the business climate and the annual exports to India, valued at around $500 million.