China stops shipments from India as retaliation

ST Staff
Friday, 26 June 2020

SK Saraf, the president of the Federation of Indian Export Organisations (FIEO), stated that as an act of retaliation due to Indian customs blocking Chinese shipments at domestic ports aided by the bilateral border disputes, China is holding back shipment from India in Hong Kong. 

SK Saraf, the president of the Federation of Indian Export Organisations (FIEO), stated that as an act of retaliation due to Indian customs blocking Chinese shipments at domestic ports aided by the bilateral border disputes, China is holding back shipment from India in Hong Kong. 

The president of FIEO termed this as a tit-for-tat action by Beijing. The FIEO has decided to take this matter to the ministry of commerce and industry because it profoundly affects the economy as a result of a delay in consignment clearance. 

The president of FIEO wrote a letter to Commerce secretary Anup Wadhawan stating, “We have been given to understand that customs is physically examining all imports from China, which is delaying clearance, adding to the cost of imports.” 

He further stated that exporters had reported blockage in shipments that are being faced from Hong Kong.

India’s export to China makes about 5.4 per cent of its total exports. In contrast, China’s export goods to India make up about 2.8 per cent of its total exports. These goods include pharmaceutical components, automobile components, lithium-ion batteries and electronic products. 

After shipments from China bringing Apple’s iPhone were blocked in different Indian ports, the US-India Strategic Partnership Forum wrote to the government stating that sudden blockage in the clearance of consignments from China will only have a negative impact on foreign investors. They also mentioned that this action might delay the delivery arrangements and cause damage to expensive materials, increasing pressure on the supply vis-à-vis the cost chain during the wake of a pandemic.

Concerns were also raised by the Indian Cellular and Electronics Association, who wrote to the Revenue Secretary and Chairman of the Central Board of Indirect Taxes and Customs (CBIC) requesting the Finance Ministry to mediate the situation as companies facing the blockage on the forefront were becoming nervous about the result of these delays and unprecedented shortcomings. It also stated that the supply of 200 industries was facing a direct impact.

Customs officers have addressed the situation by saying that the delay in shipment is being caused due to the extra time being required to supervise Chinese goods carefully and no official order has been given from the authority to hold back Chinese shipments.

The FIEO president said that he is expecting a clarification for the same by Friday. “Kindly take it up with CBIC and, if no such instructions have been given, a denial may be issued by CBIC so that the matter may be communicated to our importers in China and Hong Kong to suitably take up with their customs explaining our stand,” he added.

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