To counter the threat from Chinese equipment, domestic electronic equipment manufacturers have urged the government to levy anti-dumping duties on Chinese electronic equipment  In a bid to prevent the influx of cheap Chinese products in the Indian electrical industry, domestic electrical manufacturers have urged the Government of India (GoI) to impose anti-dumping duties on Chinese products entering the Indian market. The Indian Electrical and Electronics Manufacturers Association (IEEMA) has written to the Ministry of Heavy Industries to take necessary steps in this direction.Domestic manufacturers suffer revenue loss
In this context, Naresh Sambhani, director of Mohit Electric, a mid-sized manufacturer of electronic equipment in Ahmedabad, says, “With GoI undertaking mega power projects in the country, the domestic electronic market is poised for growth. But with Chinese products flooding the domestic electronic market, domestic equipment manufacturers are suffering huge losses as these products are not only readily available but are also much cheaper as compared to those made in India.” In fact, Chinese equipment are provided incentives by the government, whereas indigenously manufactured equipment are subjected to taxes.
It is to be noted that leading power equipment manufacturers in the country such as Larsen and Tubro (L&T) and Bharat Heavy Electricals Ltd (BHEL), among others have raised concerns about Chinese equipment being rampantly imported by India. According to Parag Limaye, managing director of Clean Power Equipment, a small-sized electronic equipment dealer in Pune, “Apart from levying anti-dumping duties, it is essential for Indian firms to expand their existing capacities to meet the rising demand of electronic products in the country. A major factor behind importing Chinese equipment is the huge gap between demand and supply.”
Mr Limaye also added that not only are Chinese equipment eating into the share of domestic manufacturers, they are also dangerous to use. Several big shots over the years have imported heavily from China as local manufacturers have not been able to cater to their demands. The issue is of grave concern considering the fact that India plans to generate additional power generation capacity of over 1 lakh mega watt in the 12th Five Year plan, as well as set up power transmission and distribution network, which will require high quality equipment. Domestic manufacturers are eagerly looking forward to these projects as it will give tremendous fillip to their business.
Recession forcing Chinese companies to shift focus to India
The issue of Chinese electronic equipment flooding the Indian market gathered momentum after the global economic meltdown, when the market for electronic items shrunk drastically in the West and China. Chinese firms began using the Indian market as a dumping ground for their goods, which found many takers as these products are low-priced yet come with all latest features similar to branded products.
On the back of Electronic Industries Association of India’s (ELCINA) prediction of the Indian electronics industry likely to be worth US$40 billion by 2010, the demand for electronic equipment will rise by leaps and bounds. Therefore, it is imperative to provide a level playing field for domestic manufacturers and boost the sector. It is expected that GoI will understand the concerns of the domestic manufacturing firms and take actions in this regard.
Arup Choudhury |
