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October 21, 2023

Concerted Eforts to restrict chinese Goods in India

Concerted Eforts to restrict chinese Goods in India

Barring the ‘denied entity list’, which includes companies that have not complied with export obligations or have been red flagged by DRI, the government has not imposed any limits on the value or quantity of imports and allowed each company to seek shipments from as many as 10 countries with one license. ‘None of the companies are  currently on the denied entry list,” director general for foreign trade (DGFT) Santosh Sarangi told reporters, adding, 100 applications have been filed so far.

Though there is no move to restrict imports from any country, the decision is expected to impact Chinese imports the most as nearly 60% of the seven products – PCs, laptops, tablets, servers, micro-computers, large or main frame computers and certain data processing machines – come from neighbouring country, which is the largest producer of electronic goods.

The import checks which are expected to throw data for ‘trusted digital system in this country”, are seen to be part of wider crackdown on Chinese goods in the wake of intrusion into Ladakh. Post Covid the government has been pushing for domestic production of select items, including electronics, to reduce dependence on imports.

Following a recommendation by the ministry of IT and electronics on August 3, DGFT announced import checks, but a day later, postponed implementation. At that time officials had cited ‘security reasons” for the move.

Subsequently, the ministry had sought to distance itself from the move. While MOS at IT ministry Rajeev Chadrasekhar had stated that Modi government does not believe in licensing, the government has struck to keeping the items on the ‘restricted list’, while avoiding the use of licensing and instead referring to checks as authorization. “The intent is not to cause any kind of inconvenience or difficulty, impose any needless restrictions on any kind of players involved”, electronics and IT secretary S. Krishnan said, adding that the goal is to promote more manufacturing of electronic hardware in the country.

As part of the “tweaks”, IT hardware manufactured in SEZs and shipped to the domestic tariff area or the non SEZ area will not require authorization. Similarly imports by private companies for government agencies have been exempted.

59% Restricted Items Come From China
import of Restricted Items ($MN)% SHARE IN India’s Import
of restricted items
China            6,296            5,118China58.9
Singapore            1,376            1,401Singapore16.1
Hong Kong            1,340                808Hong Kong9.3
US                338                345US4.1
Malaysia                326                325Malaysia3.7
Taiwan                319                273Taiwan3.1
Netherlands                  75                133Netherlands1.5
Vietnam                106                126Vietnam1.4
Others                  11                167Others1.9
Total          10,187              8,696100

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