City’s bicycle industry wants cheap imports via SAFTA to be plugged
Infuriated over cheap imports from China that are ruining the local bicycle industry, having strongest base in the country, bicycle manufacturers have demanded that the union budget that would be announced on February 28 should focus on the specific problem of “unhealthy” imports and try to raise exports of the country.punjab Updated: Feb 04, 2015 16:17 IST
Infuriated over cheap imports from China that are ruining the local bicycle industry, having strongest base in the country, bicycle manufacturers have demanded that the union budget that would be announced on February 28 should focus on the specific problem of “unhealthy” imports and try to raise exports of the country.
The second part of the series brings forward the problems concerning bicycle industry that has been raising the issue of goods being sent on under billing from China that are not only causing immense damage to the Ludhiana bicycle and cycle parts manufacturers, but have also resulted in huge losses to central government.
Cycle industry has demanded checking of imports by imposing duty on the weight of products, so that there would be no under billing of individual products.
There are at least 4,000 bicycle and bicycle part manufacturing units in Ludhiana that even supply parts to some international companies. This makes bicycle industry one of the most important industries in the country. With some of the world famous brands based in city, the industry generates huge revenue and employment.
Cheap imports from China
Bicycle manufacturers have been pleading the issue of imports from China that has increased extensively during the past six to seven years. The bicycle manufacturers have been demanding hike in import duty from 30% (bicycles) and 20% (cycle parts) to 50% from the Centre, so as to keep a check on the cheap imports from China. Now, the manufacturers have also forwarded an idea to the central government of checking the weight of cycle parts being imported from China so that under billing could be checked.
Rollback central excise duty
Bicycle industry has been demanding for the past long time that the central excise duty of 2% be removed. Industry claims that the price of a cycle increases by `50 with this central excise duty of 2%. Although the cost of a single bicycle does not increase significantly, but paperwork of an industry increases. Also there is not much profit to the central government with this minuscule duty.
Monitoring of SAFTA route
South Asian Free Trade Area (SAFTA) route has been damaging the prospects of Ludhiana bicycle industry, as China was dumping its cheap cycle parts from this route. Local traders are annoyed over the inaction of the central government on entry of Chinese cycle parts from SAFTA countries with zero import duty. Chinese companies send bicycle parts manufactured through Sri Lanka and Bangladesh into India. This was causing a huge loss to the government of India as well as the bicycle manufacturers in Ludhiana.
Steel regulatory body
Bicycle manufacturers in Ludhiana have also been making a demand that a regulatory body for price of steel should be formed, so that sudden rise in the price of steel every now and then could be checked. This would also ensure proper planning in manufacturing by the industrialists.
Cycle paths on roads and highways
Cycle industry says that all government roads and highways should have bicycle paths along them. People in most parts of the country do not use bicycle as means of transportation due to non-availability of special paths for cycles. Riding bicycles on roads causes a risk to the cyclists, as a result people often avoid riding bicycles on main roads.
Awareness about schemes for MSME
Bicycle industry believes that the schemes launched by the central government for betterment of the industry do not reach to all manufacturers due to lack of awareness and information. Central government should organise special programmes for the Micro, Small and Medium Enterprises (MSME) so that the bicycle industry could be benefitted.
Auto parts industry tomorrow
First Published: Feb 04, 2015 16:11 IST