$62 billion imports at $47 billion deficit, customs duty hike on Chinese products on anvil

Amid increasing tensions on the border, the Central Government is considering hiking customs duty on a range of products, mainly those imported from China. While no final decision has been made as yet, the government would emphasize cutting down the import of non-essential items from the neighbouring country. As per a PTI report, a discussion took place among the authorities over hiking duties on goods imported from China.

Nearly 14 per cent of India’s total imports come from China. From April 2019 to February 2020, India has imported goods worth USD 62.4 billion, while exported goods worth USD 15.5 billion to the neighbouring country. Mainly, the products imported from China include clocks and watches, musical instruments, toys, sports goods, furniture, mattresses, plastics, electrical machinery, electronic equipment, chemicals, iron and steel items, fertiliser, mineral fuel and metals.

India has often raised concerns over increasing trade deficit with China, which stood at about USD 47 billion between April 2019 to February 2020. The move to hike customs duty on imported goods also holds significance as the Centre is working on ways to boost local manufacturing and promote Make in India products.

Citizens demonstrate against China
This development also comes at a time when citizens across the country are outraged over the barbaric attack over the India Army jawans by Chinese troops that led to the death of 20 soldiers on June 15 at the Galwan Valley in Ladakh. The Indian troops gave it back to the Chinese with three different reports stating a range of 35-45 Chinese casualties even as Beijing conceals its numbers. People have taken to the streets to express their disdain towards China and its President Xi Jinping. Scores of individuals including celebrities and popular names in the country have pledged to boycott Chinese products and encourage Made in India goods. The movement has gathered momentum with several organisations and trade associations severing imports from China.

Railway PSU cancels Chinese company’s contract
In another major development, the Dedicated Freight Corridor Corporation of India (DFCCIL) – a PSU under the aegis of the Ministry of Railways – has terminated a Chinese company’s contract. This contract pertained to the signalling and telecommunication work in Kanpur-Deen Dayal Upadhyay section was awarded to Beijing National Railway Research and Design Institute of Signal and Communication Group Co. Ltd. in June 2016. The contract cost of Rs.471 crore was going to funded by a loan from the World Bank. As per the DFCCIL, only 20% of the work was completed despite the passage of 4 years.