Strict scrutiny of Chinese imports affects industries

With the Centre taking a tough stand on imports from China amid the border tensions, several industries that depended on inputs from that country are facing delay in getting their supplies as the goods are held up at ports and airports and are being subjected to stricter Customs scrutiny.

Several industry bodies, from apparel to electronics, have written to the government urging faster Customs clearance as delays might affect the manufacturing process.

Citing the gravity of situation, in a letter to Central Board of Indirect Taxes and Customs (CBIC) Chairman M Ajit Kumar, the Apparel Exporters Promotion Councils said the delay in clearances of goods was adding to the crisis for the industry that was gearing up to get back to the normal after easing of lockdown in India and other countries.

The delay was impacting operations and might cause further financial losses, it said.

"Lately, Customs authorities at several ports are doing 100 per cent examination of goods originating from China, Hong Kong and Taiwan. It has created undue delay in clearance of imported inputs meant for production of garments for exports," AEPC Chairman A. Sakthivel wrote.

In a letter dated June 23, the India Cellular and Electronics Association (ICEA) said the 'adverse' action by the Customs would impact over 200 mobile and electronic manufacturing units, set up following the 'Make in India', 'Digital India' and 'Phased Manufacturing Programme' initiatives.

"There was refusal to clear, followed by delays. And now, about 100 per cent examination. The logistics of seamless movement is in total disarray," ICEA Chairman Pankaj Mohindroo wrote to the Finance Minister.

Mohindroo said companies had received word from Chennai, Mumbai and Delhi airports about the new examination procedure for all China-origin consignment. The 100 per cent examination of only China-origin goods be stopped to help supply chain move without hurdles, he urged the Finance Minister.

MAIT, industry body representing the information and communications technology sector,  feels importers with 'authorized economic operator' (AEO) status should be excluded from such rigorous scrutiny.

"We understand the step of thorough inspection of containers was being taken to safeguard India's interests. In such a case, as an industry we suggest importers with AEO status, also called Green Chanel Importers, be excluded from it as they are GOI-validated entities. As citizens of India, we will stand by decisions the government may deem fit to take," said George Paul, CEO, MAIT.

As the call grows for lowering dependence on Chinese imports and becoming self-reliant, experts and industry players have cautioned against knee-jerk reaction and sought building of adequate infrastructure and supply chain in the country.

The impact of such action at the moment might be severe as industries were reeling under financial crisis post-lockdown, experts said.