MSME Ministry raises concern over increased imports from China
Updated: Jun 18, 2013 01:02:19pm
New Delhi, Jun 18 (KNN) The Ministry of Micro, Small and Medium Enterprises (MSME) has raised concerns over the impact of increased import of Chinese goods on Indian SMEs.
“Imports from China of eight major products that are manufactured by MSMEs grew faster than their respective imports from all countries in the four years from 2008-09 to 2011-12,” said a media report.
These product groups pertain to electrical and electronics; mechanical and metallurgical products; chemical and glass and ceramics-based products. They accounted for 54 per cent of India's total imports from China in 2011-12.
The ministry's findings are based on data compiled by the Directorate General of Commercial Intelligence and Statistics (DGCIS).
Owing to the presence of a large number of MSMEs in these sectors, a significant proportion of Indian MSMEs are facing greater competition from China compared to the rest of the world, the ministry said.
Besides, MSMEs in the country are also facing challenges like inadequate exposure to international market and low capital base.
However, earlier this year, the Minister assured that the government was in the process of implementing various schemes to overcome challenges to the growth of MSMEs.
The Gross Budgetary Support (GBS) for the 12th Plan (2012—17) of the Ministry of MSME has been approved at Rs 24,124 crore by the Planning Commission. These schemes and programmes are intended to help MSMEs grow, increase their competitiveness and consequently exports, he said.
For export promotion in particular, the Ministry is implementing the Market Development Assistance Scheme as also various other export promotion schemes through its autonomous bodies, such as the National Small Industries Corporation (NSIC), Khadi and Village Industries Corporation (KVIC) and Coir Board.
Meanwhile, industry body Assocham has stated that around 1,000 SMEs producing colours, squirt guns and other items used in the Holi festival have closed down owing to increased imports from China.
Another Assocham study done earlier has said that imports of ceramic products from China have virtually led to the closure of smaller ceramics manufacturing units in India. Ceramics imports from China, at around Rs 2,700 crore (USD 497 million), account for almost 64 per cent of India's total ceramics imports, with Germany and France accounting for seven per cent and four per cent, respectively.
The study also pointed out that the rate of growth of ceramic imports from China has shot up from eight per cent a few years ago to more than 42 per cent currently. This huge volume of imports at cheaper prices has impacted the profit margins of the Indian ceramics industry and smaller firms are almost on the verge of closure, it said.
Further, according to a 2012 study by the department of industrial policy and promotion in the ministry of commerce and industry, the basic goods and intermediate goods sectors were negatively affected by cheap Chinese imports along with some items in the capital goods and consumer goods sectors. The study said that China has become the largest source of India's imports, with a 11.7 per cent share in total imports, according to a media report.
The report also said India was an easy target for Chinese exports because its manufacturing sector was struggling to improve its relative strength in the economy (manufacturing share in GDP is stagnant), manufacturing for export was to an important extent done by SMEs or was based on the use of imported raw materials. (KNN)
“Imports from China of eight major products that are manufactured by MSMEs grew faster than their respective imports from all countries in the four years from 2008-09 to 2011-12,” said a media report.
These product groups pertain to electrical and electronics; mechanical and metallurgical products; chemical and glass and ceramics-based products. They accounted for 54 per cent of India's total imports from China in 2011-12.
The ministry's findings are based on data compiled by the Directorate General of Commercial Intelligence and Statistics (DGCIS).
Owing to the presence of a large number of MSMEs in these sectors, a significant proportion of Indian MSMEs are facing greater competition from China compared to the rest of the world, the ministry said.
Besides, MSMEs in the country are also facing challenges like inadequate exposure to international market and low capital base.
However, earlier this year, the Minister assured that the government was in the process of implementing various schemes to overcome challenges to the growth of MSMEs.
The Gross Budgetary Support (GBS) for the 12th Plan (2012—17) of the Ministry of MSME has been approved at Rs 24,124 crore by the Planning Commission. These schemes and programmes are intended to help MSMEs grow, increase their competitiveness and consequently exports, he said.
For export promotion in particular, the Ministry is implementing the Market Development Assistance Scheme as also various other export promotion schemes through its autonomous bodies, such as the National Small Industries Corporation (NSIC), Khadi and Village Industries Corporation (KVIC) and Coir Board.
Meanwhile, industry body Assocham has stated that around 1,000 SMEs producing colours, squirt guns and other items used in the Holi festival have closed down owing to increased imports from China.
Another Assocham study done earlier has said that imports of ceramic products from China have virtually led to the closure of smaller ceramics manufacturing units in India. Ceramics imports from China, at around Rs 2,700 crore (USD 497 million), account for almost 64 per cent of India's total ceramics imports, with Germany and France accounting for seven per cent and four per cent, respectively.
The study also pointed out that the rate of growth of ceramic imports from China has shot up from eight per cent a few years ago to more than 42 per cent currently. This huge volume of imports at cheaper prices has impacted the profit margins of the Indian ceramics industry and smaller firms are almost on the verge of closure, it said.
Further, according to a 2012 study by the department of industrial policy and promotion in the ministry of commerce and industry, the basic goods and intermediate goods sectors were negatively affected by cheap Chinese imports along with some items in the capital goods and consumer goods sectors. The study said that China has become the largest source of India's imports, with a 11.7 per cent share in total imports, according to a media report.
The report also said India was an easy target for Chinese exports because its manufacturing sector was struggling to improve its relative strength in the economy (manufacturing share in GDP is stagnant), manufacturing for export was to an important extent done by SMEs or was based on the use of imported raw materials. (KNN)
Loading...
