Indian firms want tougher quality norms on Chinese goods

Hit by the influx of cheaper Chinese goods in the domestic market, India's small and medium enterprises (SMEs) want tougher safeguard duties and quality norms to be imposed on imports from the neighbouring country, say an an industry lobby survey.

Chinese goods are 10 to 70 percent cheaper than their Indian counterparts and the flood of such products in the domestic market have affected companies across sectors at a time when demand is already low due to the global slowdown, said the survey conducted by the Federation of Indian Commerce and Industry (FICCI).

Nearly 70 percent of the participants said they were feeling the heat in the domestic market due to rising imports from China.

Among the industry segments that have been impacted by this onslaught are processed food items, light engineering goods, heavy engineering goods, chemicals and chemical products and metal products.

While competing with Chinese products on the price front may not be an easy task, many Indian SMEs said imports from the Asian giant must clear quality and safety norms before these are allowed to be marketed in India.

"The price gap between the Indian products and Chinese products is huge. Interestingly, India has not offered the 'market economy' status to China, as there are serious distortions and lack of transparency in the pricing of products that come out of any Chinese factory," FICCI said in the report.

Immediate imposition of severe testing requirements on Chinese goods is a must as these include basic items of consumption and even vaccines, the SMEs said.

The companies also expressed concern that imports from China were likely to go up further as Beijing was giving incentives to boost exports.

"Companies are apprehensive that as the Chinese government gives more incentives to boost exports, which are the mainstay of the Chinese economy, imports into India and other neighbouring countries would only go up," FICCI said.

To deal with such a scenario, India should beef up its anti-dumping investigations on Chinese goods and take quick decisions, it added.

Last updated on Jun 14^th, 2009 at 12:55 pm IST--IANS