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Large Number of Indian MSMEs Hit By Cheap Chinese Imports, Says Govt

Press Trust Of India

First published: November 16, 2016, 4:51 PM IST | Updated: November 16, 2016
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Large Number of Indian MSMEs Hit By Cheap Chinese Imports, Says Govt
An employee combs a wig as she works at a wig factory in Qingdao, Shandong province. (Photo: Reuters)

New Delhi: A "significant proportion" of Indian MSMEs seem to be adversely affected by select Chinese imports, which grew at a higher rate compared to shipments from rest of the world, Parliament was informed on Wednesday.

According to information compiled from data provided by Director General of Commercial Intelligence and Statistics,
imports from China in 11 major product groups, largely manufactured by MSMEs in India, have grown at a higher rate
than their respective imports from all countries combined during 2012-13 to 2015-16.

"As these 11 product groups accounted for 74 per cent of India's total imports from China in 2015-16, a significant
proportion of Indian MSMEs seem to be adversely affected from Chinese imports as compared to the rest of the world,"
Minister of State for MSME Giriraj Singh in a written reply in the Rajya Sabha.

The 11 product groups pertain to electrical and electronics, mechanical and metallurgical products, as well as
chemical, glass and ceramics based items.

Union MSME Minister Kalraj Mishra, during a recent visit to China, had invited the country's businesses to partner with Indian companies, including micro, small and medium enterprises (MSMEs) for technological collaboration and
manufacturing in India.

FDI policy places some restrictions on foreign investment in certain sectors. Subject to such restrictions, foreign
investors can set up enterprises in India without a lower level ceiling on investment. Such investment can be greenfield as well as in existing enterprises.

"India has one of the most liberalised FDI policies in the world, wherein 100 per cent FDI under automatic route is
permitted in most of the sectors. There is only a small list of sectors where FDI is regulated -- subjected to government approval, cap or having other conditionalities. The FDI policy equally applies to MSME sector," Singh said.

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