x Abu Dhabi, UAEMonday 24 July 2017

Al Ansari and Videocon help Indians skirt taxes on TVs

In August, the Indian government imposed a 36 per cent duty on airline passengers carrying flat-screen televisions as accompanied luggage.

Al Ansari Exchange has tied up with an Indian electronics manufacturer to target the consumer market squeezed out by increased taxes on flat-screen TVs.

In August, the Indian government imposed a 36 per cent duty on airline passengers carrying flat-screen televisions as accompanied luggage.

Passengers had been allowed to carry on TVs up to 39 inches in size with no tax liability. The move resulted in a drop in 32-inch to 40-inch television sales in the UAE.

Yesterday, Al Ansari said it was teaming up with Videocon to help consumers in India avoid import tax on Videocon products delivered from the UAE and paid for through the exchange’s network.

A 32-inch Videocon TV retails for about Dh699 in the UAE and Dh850 in India.

“Our strategic new partnership with Videocon could not have come at a better time, as we have been seeing increased activity in remittances being sent from the UAE to India,” said Rashed Ali Al Ansari, the general manager of Al Ansari Exchange. “Rest assured that we will remain steadfast in the commitment to develop more programmes and services that brings our expatriate customers, particularly those from India, closer to home.”

UAE retailers have been working with India’s electronics manufacturers to make up for the shortfall in sales after of the tax increase last year.

“We have been running a similar deal since last October,” said Nilesh Bhatnagar the chief executive of Emax Electronics. “There was a significant hit to our business during Gitex in 2013 and Dubai Shopping Festival in 2014. We could see the movement of 32-inch and 40-inch, which used to be carried as accompanied baggage, drop 7 per cent to 8 per cent and we could see it dropping further.

“I can’t say the deal with Videocon has made the difference in pickup. Videocon has done well as India and UAE are all part of the same management, unlike Sony or Samsung, which have independent Indian offices to the Middle East, so it may not be practical for other brands. I can see us extending the offer from televisions to other domestic appliances such as refrigerators and washing machines.”

However, some Indian consumers are brand-focused rather than price-sensitive.

“It won’t affect the business that much because Videocon is not the majorly preferred brand in India. It is a low-end brand,” said Jehas Habison, the purchasing manager of Costless Electronics. “People in India are not desperate to have a TV at any cost. People are looking for Sony or Samsung. They want the big brands.

“I don’t see this affecting the business so much. Videocon is just trying to gain market share in the UAE – Al Ansari will do some business because there are masses of labourers and such, and Videocon appeals to them as a price matter.”

ascott@thenational.ae

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