More restrictions on anvil

New Delhi The central government’s decision to delay its licensing mandate for the import of laptops, tablets, and personal computers by nearly three months should not be seen as a rollback. It is more of a breather for businesses to adjust themselves for the restrictions, which the government announced than rethink on the part of decision makers, industry sources told Bizz Buzz.

In fact, the government may announce more import restrictions. Some of these may pertain to point of sale (PoS) machines and non-tariff barriers (NTBs). The sources pointed out that the government has sought information from business chambers regarding the NTBs erected by other countries, so that similar measures could be adopted by India.

While the notification issued on August 3 by the Directorate General of Foreign Trade (DGFT) did not mention China, it is the huge electronic imports from our northern neighbour that were the target. Imports of personal computers, laptops, and palmtops from China were worth $558.36 million in April-May. Though it was lower than $618.26 million in the corresponding period last fiscal, it still accounted for 70-80 per cent of total such imports.

The recent move should be seen as a continuation of the government’s efforts to reduce China’s presence in the India market, the industry sources said. They point out the decisions taken a few years ago restricting investments from the companies from countries which share a land border with India. While China was not named at that time too, the targets were Chinese businesses.

Economists and industry bodies are often the votaries of international trade. The government, however, is not so convinced about the beneficial effects of international trade, the sources said, adding that New Delhi doesn’t want to play by the rules that Beijing likes.

India wants to settle the border with China, but the latter wants to keep the issue hanging. At the same time, it wants the bilateral trade to grow, which results in a huge excess of imports from China over exports to it. The DGFT action, the sources said, should be viewed against the backdrop of political situation.