Macro Economy

Plastic industry to Govt: Levy anti-dumping duty on cheap product imports

Our Bureau Mumbai | Updated on December 12, 2019

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The All India Plastics Manufacturers Association has urged the government to restructure customs duties, levy anti-dumping duty on import of cheap finished products from countries that have signed Foreign Trade Agreements, enforce mandatory Bureau of Indian Standards (BIS) norms and set up a technology upgradation fund for the industry.

In an emergency meeting held recently in Mumbai, the association asked the government to engage with the industry to ideate and implement impactful policy solutions for the industry, which is expected to play a key role in India becoming a $5-trillion economy.

Arvind Mehta, Chairman, Governing Council, AIPMA, said the industry is currently witnessing deep depression which has led to halt of expansion projects and investment plans.

He highlighted the need for the government to come out with clear plans and strategy on various fronts in order to give growth a much-needed push.

Jagat Killawala, President of AIPMA, said taking into account the short- and long-term growth of the plastics processing industry, the government should not come under pressure from any quarter in the matter of increasing customs duty on key raw materials.

The industry demanded that customs duty of PVC should be brought down to 7.5 per cent from 10 per cent as nearly 50 per cent of demand in India is being met through imports due to lack of domestic supply, he said.

It also demanded that the custom duty on styrene acrylonitrile resin (SAN) and acrylonitrile butadiene styrene (ABS) should be brought down to 5 per cent to nurture the growth of associated industries.

The plastics processing industry comprises over 50,000 micro units and produces goods worth Rs 3.75-lakh crore annually. However, it is under severe strain due to cheap imports from China and other south Asian countries.

To prevent under-invoicing by foreign players, the industry has demanded floor pricing on finished goods. The Directorate General of Trade Remedies should recommend anti-dumping duty on finished plastic goods imported from three major producing countries, including China, for five years, it said.

The current FTAs have resulted in massive import of finished goods from these countries at zero duty, badly affecting the Indian plastics processing industry. However, exports from India to these countries have grown only marginally, leading to huge trade imbalance. Therefore, industry has demanded that polymers and its products be excluded from all FTAs.

The government’s plan to enforce mandatory BIS standards on raw materials is expected to put small enterprises at a disadvantage as this would lead to import of semi-finished and finished products.

Mandatory BIS standards on finished plastic goods will also impact small companies due to the compliance burden, high cost of certifications and their renewal, non-availability of adequate facilities for testing, and harassment by authorities, he said.

Published on December 12, 2019

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