Domestic manufacturers of electronics, white goods, and mobile phones welcomed India’s ‘rules of origin’ norms on imports that will come into effect soon, according to the industry group the India Cellular & Electronics Association. The group’s Chairman Pankaj Mohindroo said the industry has been highlighting to the Commerce Ministry and Finance Ministry that many imported products are rerouted through countries that have free trade agreements (FTAs) with India so importers can avoid tariffs.
According to Mohindroo, this practice hurts the domestic manufacturing industry. He noted that the Customs authorities would come down heavily on errant and unethical importers while ensuring compliant imports are not disrupted. Super Plastronics CEO Avneet Singh Marwah said many brands are rerouting appliances through FTA countries without adding much value before entering India tariff-free. Hence, Marwah believed that stringent action is needed to stop such infringements.
Meanwhile, the President of Consumer Electronics and Appliances Manufacturers Association (CEAMA) Kamal Nandi raised concerns that under FTAs, imports of components are levied duties while finished products do not attract tariffs. Nandi also said the industry and the government are working closely to promote domestic manufacturing and reduce imports of finished products.
The ‘rules of origin’ norms are aimed to prevent FTA partners from dumping products from a third country to India. FTA partners will be required to provide credible proof that it has added value to the products they export to India. Meanwhile, Indian importers will need to provide certificates of origin to claim preferential rates of tariffs for the imported goods. Customs officers will be granted authorities to enforce the new regulations.
