Centre strengthening import monitoring system to strategise on lowering inflows

In line with the Centre’s policy to check non-essential imports, the Commerce Ministry is strengthening its import monitoring system to identify and act on import surges by coordinating with other Ministries and Departments.

“The aim is to take instant note of a surge in imports of specific items and also identify goods that are being imported in large quantities. Possible measures to check imports of the identified items including import substitution could then be discussed with line Ministries and Departments concerned,” a senior official said.

While the Commerce Department had created an import monitoring cell in 2019, it kept vigil on imports mostly on its own. Stakeholder Ministries and Departments, like steel or textiles, did put in place import reduction measures but since no information was available with the Department of Commerce on a regular basis, there is no mechanism to assess the impact of such an initiative/action on India’s import, the official added.

“The proposed system would provide a better feedback system and information sharing based on specially designed formats that would enable impact evaluation in the Department of Commerce,” according to a background note prepared by the Department.

Once import surges are identified, a number of actions could be taken to check imports. One option is to address supply rigidities, the paper noted. “In consultation with line ministries, steps could be taken to address supply rigidities so that domestic supply is increased and dependence on imports goes down. The Production Linked Incentive scheme for 13 sectors is an important step in that direction. More such measures could be taken,” the official said.

Trade remedial action

Another method to check imports is to take timely trade remedial action. “ The Department of Commerce and the line Ministries could quickly act to take remedial action by imposing safeguard duties or anti-dumping duties when an increase in imports is noticed,” the official added. Timely imposition of import restrictions and prohibitions can also help to curb surges.

The third way to keep a control on imports is through mandatory imposition of technical standards, especially on items that are sensitive. Strict enforcement of FTA rules of origin, to ensure that imports from third countries (non-FTA partner countries) do not make their way into India at concessional norms, is another important way to check a rise in imports. “Exchange of information and joint evaluation by all Ministries and Departments concerned would indeed help in taking appropriate steps to check imports,” the official said.

India’s total imports in 2020-21 were at $394.43 billion as opposed to exports worth $291.8 billion.

The government has already been putting in place a number of measures to check imports of non-essentials and low quality items such as increasing customs duties, introducing quality control norms and taking timely action against dumping of goods from other countries. Import monitoring systems for coal and steel items are also in place.

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