The Indian government’s decision to hike import duty on Pentium II and Celeron processor chips has raised storm in the computer industry, chip manufacturer Intel decided to carry on talking with the government over its decision to treat the two new generation chips from Intel as populated printed circuit boards. This decision has been severely criticized by the hardware industry. The hike in duty proposed by DoE will in turn lead to a mark-up of between 3% and 5% in the price as the processor costs typically comprise between 30% to 40% of a PC cost. The entire market is likely to be effected as close to 90% of the PC integrators in India use either P-II, Celeron or Cyrix chips. It will also give a big boost to the smuggled chips market.
