Apart from Chinese dumping, industry associations, PHDCCI and ASSOCHAM emphasized addressing key cost drivers in manufacturing, such as high capital and logistics costs
Various trade and industry bodies outlined essential policies to effectively combat Chinese dumping in India and to elevate the competitiveness of Indian manufacturers on the global stage during their pre-budget meeting with the Ministry of Finance on Monday. Finance Minister Nirmala Sitharaman chaired the fifth round of consultations on the upcoming budget.
Industry associations, including the PhD Chamber of Commerce and Industry (PHDCCI) and the Associated Chambers of Commerce and Industry of India (ASSOCHAM), asserted the necessity for stringent measures to counteract Chinese dumping. Furthermore, they firmly advocate for robust manufacturing support, with a particular emphasis on empowering medium and small enterprises (MSMEs) to thrive in a competitive environment.
“The discussion was more on the Chinese import. There is a serious concern shown by all industry leaders that there should be some sort of protection given to Indian industry from dumping of Chinese products. It is happening across sectors. For example, we saw millions of tons of steels coming in,” said Hemant Jain, President of PHDCCI. While the concern for China could be grave, they have also suggested to keep a check on dumping on other countries.
From steel, aluminium to paperboards, the body suggested having anti-dumping policy to safeguard India. PHDCCI highlighted that US has imposed 10 per cent tariffs on aluminium imports while China imposed 25 per cent duty on aluminum s crap imports from USA, with other restrictions. As India is a natural market, countries with surplus aluminium capacities, are targeting and dumping their aluminium into India.
At a time, when India is opening various sectors for various free trade agreements with several countries, policies bolstering the Indian manufacturing sector, for particularly creating an enabling environment for MSMEs is much needed, suggested the industry bodies.
They emphasized addressing key cost drivers in manufacturing, such as high capital and logistics costs, to enhance India’s global competitiveness. They recommend expanding the successful Production Linked Incentive (PLI) scheme beyond the current 14 sectors to include areas like medicinal plants, handicrafts, leather, footwear, gems, jewellery, and the space sector. Additionally, PHDCCI highlights the issue of the inverted duty structure in sectors such as cement, aluminium, steel, packaging materials, and paper industries. Resolving these issues, as stressed by Jain, will reduce manufacturing costs and strengthen India’s position in global markets.
Assocham suggested to make more conducive policies for the MSMEs by enhancing their credit access and by developing Integrated Infrastructure Townships for MSMEs (a revised version of the old Industrial Estate Development Program) across the country.
The apex trade chamber proposed several measures to boost investment, including broadening the scope of presumptive taxation to cover MSMEs and emerging sectors such as data centers, data hosting, and cloud computing. Sanjay Nayar, President of ASSOCHAM, emphasized the need for banks to regularly disclose the number and value of collateral-free loans issued.
“The upcoming Budget can provide an additional allocation or net to enhance credit flow to the MSMEs, much like the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) launched during COVID, which proved to be a lifeline driving the growth of MSMEs,” added Nayar.