Exporters fear Chinese companies gaining global foothold by selling duplicate products at cheaper rates

Pleads for interest subvention scheme, cut in transaction and shipping charges to counter losing market share

Exporters have raised concerns over the sale of duplicate and fake products from China in African and Gulf countries.

In a representation to the commerce ministry, exporters said if the Chinese companies concerned continue to sell at cheaper prices, these products of poor quality would grab a bigger market share. Manufacturers and exporters of textiles, garments, stainless steel, machinery and mechanical appliances would be hit badly, they said.

The exporters had recently met Commerce Secretary Rajeev Kher and Director General of Foreign Trade Pravir Kumar. They said the government’s move to withdraw export incentives for African and Gulf countries would force them to concentrate on domestic market. This would result in China and Bangladesh occupying the void.

The exporters’ move comes close on the heels of Prime Minister Narendra Modi’s visit to China where he made a strong argument in favour of further growth in economic partnership between the two countries.

“Exports of textiles to most African countries were eligible for benefit under the erstwhile foreign trade policy. In the new policy, the benefit is not there to African countries. Exporters are unable to abide by their commitments, leading to cancellation of orders. Currency depreciation of 20-25 per cent is making the situation worse,” said an exporter associated with the Federation of Indian Export Organizations (FIEO).

FIEO’s western region chairman Khalid Khan made a strong case for a level-playing field for Indian manufacturers and exporters to take on their foreign counterparts. “Restoration of incentives and benefits is one such measure needed to counter the sale of duplicate and fake products by Chinese companies. Besides, the government will soon have to launch interest subvention, as it becoming difficult for exporters to pay more on working capital loans. Interest payable by exporters here against export credit is far higher than those payable in many countries, including China,” he told Business Standard.

“High transaction costs are due to high interest, high shipping and clearing charges and port congestion. Fees charged by shipping companies are exorbitant compared to fees in China and other countries. This apart, the exporters have been experiencing difficulties in obtaining landing certificates and other documents and they have to pay heavy charges for these,” he added.
DRAGON SCARE

• Exporters say government’s move to withdraw export incentives for African and Gulf countries will force them to concentrate on domestic market. Which will enable China and Bangladesh to occupy the void
   
• This comes close on the heels of Prime Minister Narendra Modi’s visit to China where he made a strong argument in favour of further growth in economic partnership between the two countries