Delay in Customs clearance to adversely affect Make-In-India: USIBC

"We have inquired with Government of India officials about the cause of these delays and shared the negative impact they're likely to have on economic growth and job creation during this fragile recovery period," the US-India Business Council (USIBC) said in a statement.

New Delhi: Amid increased vigilance at ports in view of border tension with China, the USIBC on Thursday said delay in clearance of shipments at customs would adversely affect the Make-In-India initiative, economic growth and job creation.

Amid heightened border tensions with China, Indian customs officials have started physical inspection of all consignments coming from the neighbouring country based on intelligence inputs.

Although there is no formal order, Indian customs authority is inspecting consignments originating from China that arrive at any airport or port, government sources with direct knowledge of the development said.

Several members, USIBC said, has complained about the sudden, unannounced enhanced customs checks at numerous ports in India have substantially slowed access to imports.

"We have inquired with Government of India officials about the cause of these delays and shared the negative impact they're likely to have on economic growth and job creation during this fragile recovery period," the US-India Business Council (USIBC) said in a statement.

The delay in clearance of consignments, it added, will adversely affect sectors critical to the Make-In-India initiative, consumers and businesses during the pandemic, like pharmaceuticals, medical devices, electronics and telecommunications equipment.

"We understand the need to protect national security. However, India's goal of becoming a self-reliant hub for global manufacturing and integrating into global value chains depends upon a foundation of transparent and predictable policy processes,: the statement said.

According to traders, the non-essential consignments like apparels, electronic items, mobile phone parts, semiconductors from China are not released from the ports since last week.

While Indian Cellular Electronics Association (ICEA) and other importers have expressed their worries over this issue to Finance, Revenue and Central Board of Indirect Taxes and Customs department. Federation of Indian Exporters Organisation also wrote to the government saying that China may do retaliation with the same strategy if the situation continues in India.

“Many companies in India are depending on Chinese companies for making their products in Pharmaceuticals, electricals, electronics, and automobiles. This will not only affect foreign countries. It will also disrupt the Indian companies as they are relying upon China,” the ICEA wrote to the Indian Government.

The ICEA further pointed out that customs officials are even recalling the released consignments for checking them again.

Indian Exporters body FIEO flagged concerns over holding up of their consignments at Hong Kong and Chinese ports in response to a similar action being taken by Indian authorities at Mumbai and Chennai port.

FIEO has written to the Commerce Secretary to take up the matter with the Central Board of Indirect Taxes and Customs (CBIC) as there is no formal instruction or circular to Indian Customs authorities for 100 per cent checking of Chinese consignments at domestic ports.

Sources further said that although physical inspection is resulting in delayed clearance of goods, in current situation the customs officials will have to work in coordination with other intelligence agencies.

The move has resulted in a retaliatory action by China with Indian exporters complaining of shipments being held up in Hong Kong.

About 14 per cent of India's total imports are from China. Between April 2019-February 2020, India has imported goods worth USD 62.4 billion, while exports to the neighbouring country stood at USD 15.5 billion.

The main goods imported from China includes clocks and watches, musical instruments, toys, sports goods, furniture, mattresses, plastics, electrical machinery, electronic equipment, chemicals, iron and steel items, Fertiliser, mineral fuel and metals.

India has time and again raised concerns over widening trade deficit with China which stood at about USD 47 billion during April-February 2019-20.

Imports from China facing physical inspection at customs based on intelligence inputs: Sources

Amid heightened border tensions with China, Indian customs officials have started physical inspection of all consignments coming from the neighbouring country based on intelligence inputs.

Although there is no formal order, but Indian customs authority is inspecting consignments originating from China that arrive at any airport or port, government sources with direct knowledge of the development said.

Authorities are checking documents, goods and valuation, they said.

"No orders, verbal or written, have been issued to any port by customs or by the Central Board of Indirect Taxes and Customs (CBIC) to bar or not to accept containers from China. If in some cases, some containers are held up then they are for the intelligence input and on the basis of risk assessment, as a routine exercise," a government source said.

Sources further said that although physical inspection is resulting in delayed clearance of goods, in current situation the customs officials will have to work in coordination with other intelligence agencies.

The move has resulted in a retaliatory action by China with Indian exporters complaining of shipments being held up in Hong Kong.

(PTI Report)