India to consider hiking import duties on 300 Chinese products

Prashasti Awasthi Mumbai | Updated on June 19, 2020

Containers are seen at the Yangshan Deep Water Port in Shanghai, China. (file photo)   -  Reuters

India is mulling on imposing trade barriers and raise import duties on as many as 300 Chinese products and elsewhere, according to two government officials cited in the Reuters report.

India would take the decision in an effort to push domestic businesses. This came at a time when the Asian Development Bank said that the Indian economy is expected to shrink by 4 per cent during the current financial year.

China and India have lately witnessed an escalation of cross-border brawl along the Line of Actual Control (LAC).

Self reliance campaign

The officials further revealed that the plan is on the plate since April and will fall along the lines of Prime Minister Narendra Modi’s recent announcement on self-reliance campaign to bolster local product supply.

The new duty structures are likely to be gradually outlined over the next three months, said the sources, who asked not to be named as the plan is still being finalized.

The government is considering raising import duties on 160-200 products and imposing non-tariff barriers - such as licensing requirements or stricter quality checks - on another 100, according to the officials.

The decision will aim at imports worth $8-10 billion with a view to deterring the substandard imports that render Indian products uncompetitive, said the first official, who has direct knowledge of the plans.

“We are not targeting any country, but this is one of the ways to reduce a trade deficit that is lopsided with countries like China,” the second official said to Reuters.

The report further disclosed that the bilateral trade between China and India was worth $88 billion in the fiscal year ending March 2019. This showed the trade deficit of $53.5 billion in China’s favour, the widest India has with any country.

Between April 2019 and February 2020, the latest data available, India’s trade deficit with China was $46.8 billion.

According to other sources, goods including electronics and tech products were among the listed items under the plan.

Another government official said the quality control certificate would not be easily attained as products have to go through rigorous checking. This could apply to imported products such as air conditioners.

India has increased duties on more than 3,600 tariff lines covering products from sectors such as textiles and electronics since 2014, a government document accessed by Reuters stated.


Published on June 19, 2020

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