Export strategy soon to cut trade deficit with China

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The Government is thinking of ways to boost exports to China. The strategy, prepared by the Commerce Ministry, will soon be put up for inter-ministerial discussions, official sources told Business Line. India has a $20-billion trade deficit with China.

Under the strategy, there would be incentives for exporters to increase sales to China. Also, Indian firms will be encouraged to tie up with multi-nationals in China to get more market access.

It includes simultaneous measures to prevent a surge in cheap/low quality imports from China by imposing safeguard and anti-dumping duties. Besides, the local standards for certain products will be upgraded to international levels and those Chinese products not conforming to the new standards here will be banned.

ENCOURAGING JAPAN, SOUTH KOREA

India will also encourage countries such as Japan and South Korea to take advantage of the lower/nil duty benefits in the respective Comprehensive Economic Partnership Agreement. This will help in substituting imports of certain cheap and low quality products from China with good quality items from Japan and South Korea at cheaper rates.

There are over 500 MNCs in China with extensive knowledge about the working of the Chinese government as well as the local language and customs. India now wants its companies to enter into joint ventures with these MNCs.

In this regard, officials point to Israeli companies that have bagged desalination projects in China through JVs with MNCs. Besides, it takes only six months to set up a company and start production in China as compared to over two years in India.

The business opportunities include segments such as small cars, housing (especially in interior regions), intricately designed jewellery, branded textiles/garments, home furnishings, jute products (as China has banned plastics and shifted to environment-friendly products), kitchen appliances, software and pharmaceuticals, officials said.

 

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