Industry raises concern over high numbers of Chinese footwear, leather imports
Imports of footwear and finished leather goods from China to India have increased, which has caused industry representatives to demand higher import tax on the named items, in an attempt to reduce the trade deficit.
Indian finished leather goods and footwear exports have fallen and Chinese imports of the same have increased. India is a net exporter of leather hides to China but these hides are manufactured into finished products and exported back to India.
Chinese exports make up 68 percent of India’s footwear imports and 91 percent of imported leather goods were value-added finished products, ET Bureau reported. This situation has caused Indian leather businesses to worry about the trade imbalance.
“We have raised our issues and the ministry is reviewing it,” an leather industry representative told ET Bureau following a meeting with the Department of Commerce.
“We have asked the import duty on Chinese footwear to be increased from 25 percent to 35 percent because of a negative trade balance on footwear.”
The industry representative also suggested that China could decrease its taxes on imports of finished leather skins from India as India does not charge import duty on the same. Import duty in China currently stands at five to seven percent for bovine finished leather, 5.6 percent for sheep or lamb finished leather, and 9.8 percent on goat finished leather under the Asia-Pacific Trade Agreement, which India is part of.
The Minister of Commerce and Industry, Suresh Prabhu, has stated that he wants India to turn its trade deficit with China into a trade surplus and the government has also stated its commitments to the leather industry. The government has recently been promoting Indian leather internationally to try and increase exports in partnership with the Council of Leather Export.
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