Tariff on PCs very high, says Michael of Dell

World’s second-biggest computer maker Dell today said it would like to cater to the low-cost market too and urged the government to cut tariffs on computers.

World’s second-biggest computer maker Dell today said it would like to cater to the low-cost market too and urged the government to cut tariffs on computers.

Dell CEO Michael Dell said the existing tariff rate of about 20-25 per cent in India was one of the highest in the world and a serious impediment to attracting foreign direct investment.

“Taxes and tariffs represent a very high portion of a product that makes people productive. We will scale up our investments consistent with the opportunity,” said Dell.

He said the company will start operations at its Chennai plant in July this year. “We are starting with the local market. Of course, exports are a potential,” said Dell.

“With local manufacturing in place, Dell’s most comprehensive presence in the world outside the US will be here in India — domestic sales, research and development, manufacturing, customer support, services and analytics,” Dell added.

Last year Dell had announced plans to build a manufacturing facility at Sriperumbudur near Chennai with an installed capacity of 4,00,000 units. The company had said the plant would see an investment of $30 million over five years. In Asia, the company has factories in Penang, Malaysia and China.

Dell also said that the company’s revenues in India grew 70 per cent year on year to $500 million and revenues were rapidly heading towards the $1 billion mark.

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Dell urged India to bring down taxes and said that because of high tariffs investments in India were suffering. “One of our suppliers has invested $5 billion in Vietnam but was not prepared to come close to our factory here.”

The CEO of the Texas based company has advocated a zero duty regime across the manufacturing value chain.