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Can’t allow cheap Chinese goods to swamp our industries: Commerce Min

As India grapples with a threat of dumping from

business Updated: Apr 15, 2016 01:53 IST
Nirmala Sitharaman

“If these capacities are going to be swamped, we can’t allow that,” Nirmala Sitharaman to HT. (HT Photo)

As India grapples with a threat of dumping from China, commerce minister Nirmala Sitharaman vows to protect domestic industry. Excerpts from an interview:

When do you see a reversal of the sustained decline in exports?

That’s a question all countries have to answer. It’s not peculiar to India. It’s not that demand for our goods and services has fallen. Demand globally has fallen.

Have you identified sectors for a special push?

I can only answer your question in a roundabout way, which is SMEs (small and medium enterprises), units which have potential for intensive employment, as opposed to [those which are] capital-intensive. India’s exports have benefitted over the years from hubs of small-scale, exportoriented manufacturing, such as, Tirupur. One gets to hear disturbing news about them. The ills that hurt SMEs are inadequate electricity, the price of that electricity, and the water supply drying up. We will work with the states. You may have surplus power, but the state must be willing to buy it. Units in the Tirupur-Coimbatore-Erode belt, which became famous for garment and yarn, have invested in solar capacities. They now produce more power than what they need. China has built up huge capacities, which are not being consumed. It seems determined to sell its produce in other countries. But having created excess capacities, it is going to push it at any cost. And there are huge subsidies involved. They raise issues at the World Trade Organisation about the extent to which subsidies can be used to distort trade. India will have to study the situation and take appropriate action.

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Which sectors will need protection?

Sectors that have substantial investments in capacities in India... whether they are competitive or not is a different issue... we have to take a call on protecting them. If these capacities are going to be swamped, we can’t allow that.

Which are those?

Steel is a classic case. There are others, such as, aluminium, stainless steel...

But protection from imports to a sector hurts other domestic companies that buy from that sector.

Downstream industries are raising a legitimate concern. If they can buy raw material from a cheaper source, why should they be forced to buy it from a domestic source only because it is domestic? These industries have to become lean and mean.

The US and UK visa norms are hurting our services industries.

On the US visa issue we have approached the WTO. About the UK issue, on the sidelines of the recent European Union summit, I met the immigration minister. I spoke not just about the visa fee, but also about the cap on the income, where unless a person earns a particular amount he cannot come to the country. Indians cannot train locals and pay a fee so that tomorrow onwards the same job is not taken over by others. This is a colonial approach, where you rip off the colony because it can give you the resource. That you do not have that talent and you will have to ask people to come in to do that job is part of fair trade. In today’s times, services are traded, and you are telling me that I do not have the service capability and to build that you will have to pay me. So we said that all these are absolutely unacceptable. We have raised each such concern with the minister, they have heard me out. We hope to see a response.

Apple has sought permission to import refurbished cellphones.

I haven’t taken a call yet. They haven’t approached me.