NEW DELHI, Sept 23: India has launched an investigation into LG Electronics and Samsung over allegations that the South Korean electronics companies paid lower tariffs on imported display components used in high-end televisions, according to sources familiar with the matter.
The investigation puts two of the world’s major television manufacturers under scrutiny as India seeks to strengthen enforcement of its customs rules and encourage greater domestic manufacturing of electronics.
According to five sources cited by Reuters, Indian authorities are examining whether the companies classified imported display parts in a way that resulted in lower customs duties than those applicable to the components. The inquiry concerns parts used in premium television sets, including OLED models.
The issue is significant for India’s rapidly expanding consumer electronics sector, where global manufacturers have increased production and investment in recent years. Premium televisions have become an important part of the market as consumers increasingly shift toward larger screens and advanced display technologies.
OLED televisions are positioned at the higher end of the market because of their display quality and technology. Companies competing in this segment rely heavily on imported components, making customs classification and tariff structures an important part of their manufacturing costs.
The investigation could therefore have implications beyond the two companies involved. Any change in the interpretation or enforcement of import duties could affect the economics of premium television production and influence sourcing decisions by electronics manufacturers.
LG and Samsung are major players in India’s television market and have established manufacturing and distribution operations in the country. Both companies have also been investing in premium consumer electronics as demand for advanced televisions, appliances and connected devices increases.
The inquiry comes as India continues to promote domestic manufacturing through policies designed to reduce dependence on imported finished products and strengthen local supply chains. Electronics has emerged as one of the sectors in which policymakers are seeking greater domestic value addition.
For manufacturers, the distinction between importing finished products and bringing in components for local assembly can have a direct impact on costs. Customs duties are therefore an important consideration in determining where companies manufacture products and how they structure their supply chains.
The investigation also highlights the complexity of India’s tariff system for electronics. Television manufacturing involves multiple components, including display panels, circuit boards, processors, power systems and other specialized parts. Different categories can attract different rates of duty depending on how they are classified.
The authorities’ scrutiny of OLED components could prompt companies operating in the sector to review their import classifications and compliance procedures.
The investigation does not by itself establish wrongdoing by either company. The allegations concern the classification and tariffs applied to imported components, and the outcome will depend on the findings of the relevant authorities.
The case comes at a time when India’s electronics industry is undergoing significant expansion. The government has sought to develop the country as a major manufacturing base for smartphones, televisions, electronic components and other technology products.
Global companies have increasingly considered India as part of their wider manufacturing and supply-chain strategies, particularly as businesses seek to diversify production across different countries.
The LG-Samsung inquiry could consequently be closely followed by other electronics manufacturers that import components into India. Companies may examine whether their own customs declarations and product classifications comply with the requirements being applied by authorities.
The developments also come amid wider changes in global trade. Businesses are dealing with shifting tariffs, supply-chain disruptions and geopolitical tensions that have encouraged manufacturers to reconsider sourcing arrangements.
India’s electronics sector has benefited from the broader movement toward supply-chain diversification, but manufacturers face the challenge of balancing local production with the availability and cost of imported components.
The investigation into the two Korean companies could therefore become an important test of how India applies its tariff rules to sophisticated electronic components. Any eventual determination could have consequences for manufacturers, importers and consumers depending on whether additional duties are imposed or existing classifications are maintained.
For consumers, the immediate impact remains uncertain. Premium television prices are influenced by several factors, including component costs, currency movements, taxes, logistics and demand. It is therefore too early to determine whether the investigation will have any direct effect on retail prices.
For the companies, however, the case underscores the importance of regulatory compliance as India deepens its role in global electronics manufacturing.