China emerges as major ceramic supplier to India, says Assocham analysis

In the past six years the import value of Chinese ceramic products into India has grown from $237 million in 2007 to $484 million in 2012, a rise of 66%, according to a recent analysis by the Associated Chambers of Commerce and Industry of India (Assocham). The Chinese import has clocked a compounded annual growth rate (CAGR) of over 15%.

"With lion's share of 66 per cent in India's total ceramic imports worth $734 million in 2012, China has emerged as the major supplier of ceramic products to the country thereby adversely impacting profit margins of existing domestic producers so much so that certain ceramic units are facing closure as they are not able to bear ever-rising production costs," stated an analysis of India's ceramics industry conducted by Assocham.

Ceramics industry in India is a diverse one containing several categories of products, like sanitaryware, refractories, advanced ceramics and ceramic tiles. Besides this, ceramic products are manufactured both in the large and small-scale sector with wide variation in type, size, quality and standard.

Tiles form the most significant part of Indian ceramics industry and consists of floor, vitrified, porcelain, wall and industrial tiles. Overall size of Indian ceramic tile industry is estimated to be approximately Rs 18,000 crore. Morbi town in Gujarat is known as the heart of the Indian ceramic industry as the cluster commands about 70% of the production of these ceramic products.

"China is producing far more than its existing consumption level of ceramic products as of about 5,200 million sq mt of ceramic tiles produced in 2012, China consumed about 4,250 sq mt and therefore China, invariably has to look for export markets to sell its surplus production. India also is one such market which is flooded by Chinese imports," said D S Rawat, national secretary general of Assocahm. "Besides, domestic ceramic products manufacturers are not able to pass on the rise in input costs to consumers due to emerging competition from countries like China which adversely impacts their profitability," said Rawat.