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Business News/ News / India/  Centre gears up to place restrictions on non-essential imports
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Centre gears up to place restrictions on non-essential imports

Non-essential imports from China amount to ₹4 trillion a year, according to a commerce ministry estimate
  • The rules will also apply to Indian producers
  • The new rules, spearheaded by trade minister Piyush Goyal, are aimed at restricting imports from China (Photo: Ramesh Pathania/Mint)Premium
    The new rules, spearheaded by trade minister Piyush Goyal, are aimed at restricting imports from China (Photo: Ramesh Pathania/Mint)

    New Delhi: India is set to finalize stricter quality standards for 371 items by March, a move primarily aimed at curbing imports of non-essential items such as toys, plastic goods, sports items and furniture, especially from China.

    The proposed rules, to be framed by ministries in coordination with the Bureau of Indian Standards (BIS), will also ensure stricter inspection of imports.

    While the new rules, spearheaded by trade minister Piyush Goyal, are aimed at curbing imports from China and narrowing the trade deficit with India’s northern neighbour, the rules will also apply to Indian producers so as to make the regulations World Trade Organization-compliant.

    Non-essential imports from China amount to 4 trillion a year, according to a commerce ministry estimate.

    On 23 December, Goyal held an interministerial meeting of commerce, industry, steel, telecom, heavy industries and electronics to chart out a course of action.

    Out of the 371 items, 111 come under the department of chemicals and petrochemicals, 68 pertain to the department of heavy industries, 62 come under the ministry of electronics and information and technology, 61 under the industry department, 44 under the steel ministry and 25 under the telecom department.

    “At present, there are 370 standards for imports. Goyal wants BIS, in coordination with other departments, to create 5,000 standards in the second phase," a commerce ministry official said on condition of anonymity.

    The official said market surveillance of imports and checking compliance was very weak. “BIS needs to do it. For this, BIS will be supported to augment its capacity, so that it can also handhold the Indian domestic industry to comply with the new quality standards," the official added.

    Local industry is often unable to meet high standards because they add to costs, a former BIS director general said on condition of anonymity.

    “They are also unable to compete with cheap imports from outside. Unless you prescribe standards and qualities for products for the country, then your domestic industry will always suffer because China will provide you at whatever cost you want a product," said the former official.

    The benefit of the move is that Indian consumers will get quality products and since most of the world is also looking for good quality products, Indian companies will be able to supply to other markets, the former official said.

    “Cheap imports many times are also very toxic, such as in toys, and not good for domestic consumers. So, it is a very good idea to actually follow standards and improve quality of your products, both for domestic and foreign consumers," added the former official.

    India’s widening trade deficit with China, which currently stands at $53.6 billion, was the main reason why India decided against joining the Regional Comprehensive Economic Partnership agreement. China did not agree to India’s last-minute proposal seeking an auto-trigger mechanism on all imports from China to appropriately safeguard itself from any sudden surge in imports.

    Speaking at an exports summit organized by the Confederation of Indian Industry last month, Goyal had indicated that the government was trying to strengthen quality standards to stop non-essential imports.

    Criticizing some industry bodies, Goyal said that several of them had become the “B-team of import lobbies" to stall the government’s move to set quality standards for imports.

    “It pains me when I see that industry bodies have become so much dependent on imports themselves that instead of working for the domestic manufacturing, several industry bodies have become the B-team of import lobbies. That I can assure you will not influence the Modi government. We are going to work relentlessly to support domestic manufacturing, at least in areas where we have competitive advantages," he added.

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    Published: 02 Jan 2020, 11:31 PM IST
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