Budget 2023 Focus on Mobile Phone Manufacturing to Boost Gaming Sector, Say Esports Industry Experts

Finance minister Nirmala Sitharaman while presenting the Union Budget 2023 on Wednesday said to increase domestic value addition in mobile phone manufacturing, customs on import of specific components and inputs such as camera lenses could be reduced while continuing concessional duty on lithium-ion cells for batteries for another year.

This announcement, along with the decision for building 100 laboratories for developing apps using 5G services, was applauded by the online gaming industry in particular. Industry insiders believe these initiatives as well as the removal of the minimum threshold of Rs 10,000 for TDS on online gaming will boost the sector’s growth like never before.

“As a result of various initiatives of the government, including the phased manufacturing programme, mobile phone production in India has increased from 5.8 crore units valued at about Rs 18,900 crore in 2014-15 to 31 crore units valued at over Rs 2,75,000 crore in the last financial year,” said Sitharaman during her budget speech.

While the world is looking for alternatives to reduce dependency on China, which has dominated the electronics sector for years, with the support of the Centre’s enabling policies, several incentive programmes, and a determination to create a competitive environment for the industry, India has become the second-largest manufacturer of mobile phones in the world.

The Gaming World

Rohit N Jagasia, founder and CEO of Revenant Esports, told News18 that even though the budget announcement did not specifically bring out matters of concern related to animation, visual effects, gaming and comic (AVGC) sector or the esports segment, the decisions noted will positively impact the sector.

“The increased mobile phone production will directly impact the growing interest in mobile gaming. India is a growing market for mobile gamers, which will shape the Indian esports sector. Affordable mobile devices and the increasing accessibility of gaming platforms have also contributed to the growing popularity of esports in India and it is expected to further drive the growth of the industry in the coming years,” Jagasia said.

On the announcement of removing minimum threshold for TDS on online gaming and providing clarity on taxability, Jagasia said it was a big step forward. However, he noted that “most esports games, like ours, don’t have any money withdrawing system so these are applicable for the online gaming sectors which are into real money gaming”.

Animesh Agarwal, Founder & CEO of 8bit Creatives, said the expansion of India’s gaming business mirrors and contributes to the growth of the mobile phone industry. “From launching gaming-specific devices such as One Plus Nord, ASUS ROG gaming phones to hosting multiple tournaments for the community, to working with gamers to building a community of mobile gamers, mobile device giants such as One Plus, ASUS, Samsung, are also investing heavily in the gaming industry in India,” he said.

The expert said Indian gaming has the potential to provide a significant boost to the electronics industry as a whole, spanning consoles, PCs, VR gadgets, mobile devices, wearables, IT accessories among others.

Lokesh Suji, director of the Esports Federation of India & Vice President of the Asian Esports Federation (AESF) said that mobile phone production in the country has been a game-changer for this sector.

“With the numbers further upscaling and 5G acting as a catalyst that fuels the industry’s flourishment, we are going to witness monumental growth within the Esports sector in the coming years,” he added.

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