India plans to impose strict rules and tariffs on Chinese imports

NEW DELHI, Jun 25, 2020, Bloomberg. India plans to impose stringent quality control measures and higher tariffs on imports from China, people with the knowledge of the matter said, as a military standoff between the neighbors threaten economic ties, BloombergQuint reported.

The state-run Bureau of Indian Standards is finalizing tougher norms for at least 370 products to ensure items that can be locally produced aren’t imported, the people said, asking not to be identified citing rules. The products include chemicals, steel, electronics, heavy machinery, furniture, paper, industrial machinery, rubber articles, glass, metal articles, pharma, fertilizer and plastic toys.

Discussions are also on to raise import duty on products including furniture, compressors for air conditioners and auto components, they said. The proposal is being evaluated by the Finance Ministry amid the government’s push for local manufacturing.

The Trade Ministry is separately evaluating non-tariff measures to check Chinese imports to avoid falling foul of World Trade Organization rules. Such measures would include more inspections, product testing and enhnanced quality certification requirement, the people said.

A spokesperson for the Trade Ministry refused to comment, while a Finance Ministry spokesman didn’t respond to a call made on his mobile during office hours.

China is India’s biggest source of imports, with purchases including electronic goods, industrial machinery and organic chemicals running into almost $70 billion last year. Beijing enjoys a trade surplus of about $50 billion with New Delhi.

The need for import substitution started after disruptions to raw material supplies from China in the wake of the coronavirus pandemic. A deadly clash between soldiers from both countries along a contested Himalayan border this month added to calls for that process to be expedited.