Import of Chinese Products in India

Seminar Report submitted for Requirements

For the Degree of
MBA
By
Sheenam Parveen
(09-MBA-52)
Under the Supervision of
Mr. Vivek Bansal

Department of Management Studies

UNIVERSITY COLLEGE OF ENGINEERING
RAJASTHAN TECHNICAL UNIVERSITY,
KOTA
MAY 2010
 Acknowledgement
I feel great pleasure in submitting this seminar report on “Import of Chinese products In
India.”

I wish to express a true sense of gratitude towards my seminar guide Mr. Vivek Bansal
who at a very discrete step in study of this seminar contributed his valuable guidance and
help to solve every problem that arose and opening the doors of the department towards
the realization of the seminar report.

Most likely I would like to express my sincere gratitude towards my family for always
being there when I needed them the most. With all respect and gratitude, I would like to
thank all the people, who have helped us directly or indirectly, I owe my all success to
them.

Date
24.5.2010 (Sheenam Parveen)
 Certificate

This is to certify that the seminar entitled “Impact of Chinese products in India”
submitted by Sheenam Parveen (09/MBA/652) in the partial fulfillment for the award of
Master of Business Administration degree, to Department of Management Studies,
Rajasthan Technical University, Kota, is carried out under my guidance.

(Mr. Vivek Bansal)

Date:
24.5.2010
 Chapter – 1 PROFILE

(1.1) CHINA COUNTRY PROFILE

Country Facts
Area: 9,956,960 sq km (3.7m sq miles)
Population: 1.29 bn
Capital City: Beijing
People: Han Chinese make up around 92% of the population. The remaining 8%
is comprised of 55 minority ethnic groups.
Official Language: Mandarin (Putonghua) with many local dialects.
Religion(s): China is officially atheistic, but there are 5 State-Registered religions:
Daoism, Buddhism, Islam, Catholic and Protestant Christianity.
Currency: Yuan or Renminbi (RMB)
Major political parties: Chinese Communist Party
Government: There are 4 major hierarchies in China: the Chinese Communist Party
(CCP), the National People's Congress (China's legislature), the government and the
military. The supreme decision-making body in China is the CCP Politburo and its 9-
member Standing Committee, which acts as a kind of 'inner cabinet', and is headed by the
General Secretary of the Chinese Communist Party. The National People's Congress
(NPC) is China's legislative body. It has a 5-year membership and meets once a year in
plenary session. However, in practice it is the CCP who takes all key decisions.
Head of State and General Secretary of the CCP: President Hu Jintao
Chairman of the Standing Committee of the NPC: Wu Bangguo
Premier of the State Council: Wen Jiabao
State Councillor (Foreign Affairs): Dai Bingguo
Foreign Minister: Yang Jiechi
Membership of international groups/organisations: United Nations (including
permanent membership of the UN Security Council), ASEAN Regional Forum (ARF);
Asia-Pacific Economic Cooperation Forum (APEC); Asian Development Bank (ADB);
Shanghai Cooperation Organisation; World Trade Organisation (WTO).
ECONOMY

Economic indicators
GDP: US $3,250.8bn (est.) (2007)
GDP per capita: US $2,461 per capita (est.) (2007)
Annual Growth: 11.9% (2007)
Consumer prices: 7.1% 2007
Exchange rate: 13.7 Renminbi = £1
China has been one of the world's economic success stories since reforms began in 1978.
In purchasing power parity terms, China is the world's second biggest economy. Official
figures show that GDP has grown on average by 9% a year over the past 25 years with an
estimate of 10.4% recorded for 2007.
The current growth model, and policy underlying it, remains heavily skewed towards
exports and investment, with little emphasis on private consumption. China has started to
adjust its economic policies to better promote sustainable growth.
The Government has highlighted its intention to:
Undertake more bank reform (and encourage banks to provide finance to rural
areas and smaller firms)
develop the capital markets (to give firms more opportunity to raise finance)
engage in deeper reform of the insurance sector (to expand the options available to
savers), and
provide a sounder regulatory structure (aimed at promoting financial integration).
A growing share of China's economic growth has been generated in the private sector as
the government has opened up industries to domestic and foreign competition, though the
role of the state in ownership and planning remains extensive. China's entry into the
World Trade Organisation in December 2001 is further integrating China into the global
economy.

GEOGRAPHY

China is twice the size of Western Europe. It is the third largest country in the world,
after Russia and Canada. Its terrain varies from plains, deltas and hills in the east to
mountains, high plateaux and deserts in the west. To the south its climate is tropical,
whilst to the north it is sub-arctic. Less than one-sixth of China is suitable for agriculture.
The most fertile areas lie in the eastern third of the country, which is economically the
most developed region.

INTERNATIONAL RELATIONS
Relations with the International Community
China has said that it wishes to pursue an independent foreign policy of peace in order to
preserve its independence, sovereignty and territorial integrity. The concept of
‘harmonious’ development, at the heart of China’s domestic policy, has been extended to
its foreign policy as China aims to create a favourable international environment to
continue its agenda of reform and opening up. To date, China has focused on developing
close relations with its neighbours, major partners and international organisations.
In support of its desire to promote a foreign policy of peace, China is playing an
increasingly active role in international affairs. It has supported the international war
against terrorism, including in the UN Security Council (where it holds one of the five
Permanent Seats) and voted in favour of limited sanctions on North Korea. China has
played a mainly constructive role in supporting UN Special Envoy Gambari’s mission to
Burma. China moved from more or less unconditional support of Sudan, supporting
UNSCR 1769 which mandated a hybrid peacekeeping force in Darfur, and has deployed
315 peacekeepers. China voted for UNSCR 1803, which mandated a third round of
sanctions on Iran, and has begun to put the squeeze on financial transactions with Iran.
However, China’s recent use of its veto (only the third since 1999) over a UNSCR on
Zimbabwe demonstrates its increasing confidence to protect its own interests.

EU-China Relations
EU relations with China were established in 1975 and are currently governed by the 1985
EU-China Trade and Cooperation Agreement. The EU is important for China’s vision of
a multipolar world and China is arguably the EU’s most important relationship outside its
own neighbourhood and the US. In January 2007 the EU and China launched
negotiations on a single and over-arching Partnership and Co-operation Agreement
(PCA) to reflect the breadth and depth of today’s strategic partnership. The PCA will set
a broad framework for the EU’s relationship with China across a wide range of areas and,
in part, will replace the 1985 Trade and Economic Co-operation Agreement. Areas of
cooperation currently under negotiation include issues such as non-proliferation, human
rights and climate change.
Today, the EU is China’s second largest trade partner and China is the EU’s largest
partner. This is reflected in the rapidly growing trade in goods in recent years, rising by
20% per annum to reach €302 billion in 2007. There is however, increasing concern in
the EU at the growing size of China’s trade surplus with the EU. At the 2007 EU-China
Summit, both sides agreed to hold an annual High Level Dialogue Mechanism, to discuss
issues affecting the trade imbalance, in order to find concrete means to increase trade in a
balanced way. The first of these meetings took place in April 2008, establishing a
framework for future exchanges.
Within the maturing EU-China comprehensive strategic partnership, dialogue and
cooperation have been increased on key international issues (e.g. Iran, Sudan and
Burma), and on key issues of globalization, such as climate change and
Africa/development. Apart from regular political, trade and economic dialogue meetings,
there are over 24 sect oral dialogues and agreements ranging from Human Rights to
industrial policy, education and culture.

UK-CHINA BILATERAL RELATIONS

Bilateral relations are excellent and have undergone a period of rapid expansion since
May 2004 when the former Prime Minister, Tony Blair and Premier Wen Jiabao signed a
Joint Statement announcing a “comprehensive strategic partnership” and a commitment
to hold annual Summit meetings between the two Premiers. Britain remains China’s
largest European investor, Chinese students make up the largest number from any single
nation in the UK, and China publishes more joint scientific research papers with the UK
than any other European country.

(1.2) INDIA COUNTRY PROFILE

Country Facts
Area: 3,287,623m sq km (1,269,219 sq miles)

Population: 1,136,000,000 (Sept 2007 est)

Capital City: New Delhi

Languages: The official language of India is Hindi, written in the Devanagari script and
spoken by some 30% of the population as a first language. Since 1965 English has been
recognised as an 'associated language'. In addition there are 18 main and regional
languages recognised for adoption as official state languages.

Religions: India is a secular state and freedom of religion is protected under the
Constitution. The main religious groups are Hindus (81.3%), Muslims (12%), Christians
(2.3%), Sikhs (1.9%).

Currency: Rupee

Government: United Progressive Alliance, a Congress-led 20-party coalition.

Head of State: President Pratibha Patil

Prime Minister: Prime Minister Manmohan Singh

Membership of international groupings/organizations: Commonwealth; United Nations

and the United Nations Human Rights Council; World Trade Organisation; South Asian
Association for Regional Co-operation (SAARC); ASEAN (dialogue partner); G4.
ECONOMY
Basic Economic Facts
GDP: $1,090 billion (2007)

GDP per head: $714 per head (2006)

Annual Growth: 8.4% (2005-2006)

Inflation: 5.6% (2006 est.)

Major Industries: Textiles, chemicals, food processing, steel, transportation equipment,

cement, mining, petroleum, machinery, software, gems and jewellery, leather
manufactures.

Major trading partners:

Exports for 2005: USA (19.1%); China (9.4%); UAE (8.4%); UK (4.9%)

Imports for 2005: China (7.3%); USA (6.5%); Belgium (5.2%); Singapore (4.8%)

Aid & development: Foreign aid was approximately $3.8 billion (2005-2006)

Exchange rate: Indian rupees per UK Pound Sterling – 78.8 (end January 2008).

GEOGRAPHY

India forms a natural sub-continent with the Himalayas to the north. The Arabian Sea and
the Bay of Bengal, which are sections of the Indian Ocean, lie to the west and east
respectively. India's neighbours are China (Tibet), Bhutan and Nepal to the north,
Pakistan to the north-west, and Burma to the north-east. To the east, almost surrounded
by India, is Bangladesh. Near India's southern tip, across the Palk Strait, is Sri Lanka.
India has 28 states with constitutionally defined powers of government. The states vary
greatly in size, population and development. Each state has a Governor appointed by the
President for 5 years, a legislature elected for 5 years, and a Council of Ministers headed
by a Chief Minister. Each state has its own legislative, executive and judicial machinery,
corresponding to that of the Indian Union. In the event of the failure of constitutional
government in a state, the Union can impose President's Rule. There are also 7 Union
Territories including the National Capital Territory of Delhi, administered by Lieutenant
Governors or Administrators, all of whom are appointed by the President. The Territories
of Delhi and Pondicherry also have elected chief ministers and state assemblies.
The 28 states are: Andhra Pradesh, Arunachal Pradesh, Assam, Bihar, Chhattisgarh, Goa,
Gujarat, Haryana, Himachal Pradesh, Jammu and Kashmir, Jharkhand, Karnataka,
Kerala, Madhya Pradesh, Manipur, Maharashtra, Meghalaya, Mizoram, Nagaland,
Orissa, Punjab, Rajasthan, Sikkim, Tamil Nadu, Tripura, Uttar Pradesh, Uttarakhand, and
West Bengal.
The Territories are: Andaman and Nicobar Islands, Chandigarh, Dadra and Nagar Haveli,
Daman and Diu, Delhi, Lakshadweep, and Pondicherry.

TRADE AND INVESTMENT

Trade and Investment with the UK:

Total two-way trade (goods) grew by 24.4% in 2008 compared to 2007. Major items of
trade in goods: UK exports- Metalliferous ores and metal scrap, non-metallic mineral
manufactures, non-ferrous metals, power generating machinery and equipment,
machinery specialised for particular industries, general industrial machinery and
equipment, electrical machinery & appliances, transport equipment. UK imports-Textile
yarn and fabrics, petroleum, petroleum products & related materials, power generating
machinery & equipment, general industrial machinery & equipment, iron & steel,
manufactures of metal not elsewhere specified, electrical machinery, apparatus and
appliances, articles of apparel and clothing accessories, footwear, miscellaneous
manufactured article.

Over 25541.3 new Indo-British joint ventures have been approved by the Government of
India since April 1996. For the period August 1991 to October 2008, the number of
technical collaborations approved from UK stands at 868, which is 10.8% of the total
technology transfer approvals (Fourth after U.S.A., Germany and Japan).

Between January and November 2008, the highest number of FDI approvals in India was
in service sector (eight) where as the highest value of FDI approvals was in drugs and
pharmaceuticals (Rs 2500 mn). For the period August 1991 to October 2008, the number
of technical collaborations approved from UK stands at 868, which is 10.8% of the total
technology transfer approvals (Fourth after U.S.A., Germany and Japan).

The UK is the four largest investor in India (after Mauritius, Singapore and USA) for the
period April 2000 to December 2008

POLITICS

The Indian Constitution provides a system of parliamentary and cabinet government both
at the centre and in the states. The Indian Parliament consists of the President, currently
President Smt Pratibha Devisingh Patil, (elected for a 5-year term as the constitutional
 head of the executive) and 2 Houses: The Lower House - Lok Sabha ('House of the
People') - directly elected on the basis of universal adult suffrage; and the Upper House -
Rajya Sabha ('Council of States') - indirectly elected by the members of state legislative
assemblies.
The Bharatiya Janata Party (BJP) and the Congress Party are the 2 main forces in the
current Indian political scene, but neither can command a clear Parliamentary majority.
The balance of power is held by a loose collection of regional and other parties

(1.3)CHINA EXPORT IMPORT DATA TO INDIA

Year China's Exports to India China's Imoprts from India

2000 1560.75 1353.48

2001 1896.27 1699.97

Percent Growth 21.5 25.6

2002 2617.73 2274.18

Percent Growth 40.9 33.8

2003 3343.59 4251.49

Percent Growth 22.2 87

2004 5926.67 7677.43

Percent Growth 77.3 80.6

 Chapter -2

Introduction to Import
(2.1)Introduction:

Starting an import business is a goal of more than thousands of merchants and

businessman. Like an export business, import business is also very profitable business, if
an importer proceeds with the right strategies. However, the long term success and
profitability of an import business greatly depends on the importer’s knowledge and
understanding about the international market and foreign market analysis.

Today, importing goods from abroad has becomes a big business. Everything from
beverages to cars--and a staggering list of other products that one might have never
imagined has now become the part of the global import. Millions of products are bought,
sold, represented and distributed somewhere in the world on a daily basis.

(2.2)Definition:

Import:

Generally an import means bringing goods into one country from another country in a
legitimate manner, typically for use in trade. Import of goods and services are provided to
domestic consumers by foreign producers import of commercial quantities of goods
normally requires involvement of the customs authorities in both the country of import
and country of export. As per the customs act 1962 import means bringing goods into
India from a place outside India.

(2.3)Reasons for Import

There are number of supporting reasons why import business and services is growing at
such a fast rate:-

Availability: An individual or business man or an importer needs to import because there

are certain things that he can’t grow or manufacture in his home country. For example
Bananas in Alaska, Mahogany Lumber in Maine and Ball Park franks in France.
Cachet: A lot of things, like caviar and champagne, pack more cachet, more of an
"image," if they're imported rather than home-grown. Think Scandinavian furniture,
German beer, French perfume, Egyptian cotton. It all seems classier when it comes from
distant place.

Price: Price factor is also an important reason for import of products. Some products are
cheaper when imported from foreign country. For example Korean toys, Taiwanese
electronics and Mexican clothing, to rattle off a few, can often be manufactured or
assembled in foreign factories for far less money than if they were made on the domestic
country.

(2.4)Import in India
The rising middle income groups of consumers in India and their increasing levels on
expenditure on various products has resulted a faster rising demand of the Indian import
business. Major imports of India include cereals, edible oils, machineries, fertilizers and
petroleum products. Total import from India estimated to be around US$187.9 billion.
India is also a bulk importer of edible oil, sugar, pulp and paper, newsprint, crude rubber
and Iron and steel.

(2.5)Import of Chinese product in Indian:

The flood of Chinese imports has raised temperatures all around, questions have been
asked in Parliament, and the many chambers of commerce have be seeched the
government to protect Indian domestic industry from the new Chinese invasion.

Quite naturally, Indian producers claim the Chinese are “dumping” their products in
Indian markets. Dumping refers to the practice of selling products abroad at artificially
low prices. Under the World Trade Organization, the recipient country can levy anti-
dumping duties in order to protect domestic industry.

It is also true that most Chinese goods are sold at dirt-cheap prices. For instance, a
Chinese Fan with a built-in invertor is available for Rs. 800-900, whereas Indian Fan
costs about Rs. 1150. Bicycles are about Rs. 500 cheaper than Indian ones. Similarly,
most electronic goods are significantly cheaper than products of comparable quality
available in India. Third, it is also undeniably true that the sheet volume of Chinese
imports will soon have an adverse effect on Indian manufacturing industries. A
newspaper report mentions that Bajaj Electricals has started importing items like Chinese
Toasters and fans into India and providing brand support and after-sales service. While
this is good news for the Indian Consumer, this can only be disastrous for the Indian
worker.

Of course, the difference in price is not a sufficient proof of dumping. Chinese labour is
certainly cheaper than in countries such as India, from where we import significant
volumes of electronic items. China also has a much lower rate of indirect taxes on inputs.
These could well account for a large part of the difference in prices. Another contributory
factor underlying the price differential is the general inefficiency of Indian
manufacturing. A recent confederation of Indian Industry seminar in Calcutta focussed on
the large distance which Indian manufacturing industries have to traverse in order to
catch up with international norms in prices and quality. India has a rather dismal rating in
competitiveness. It ranks a low 53 out of 59 countries ranked by the World Economic
Forum and 40 out of 46 countries ranked by World Bank.

As a wide range of cheap Chinese products flooded the Indian market, some local
industries were adversely affected, while others benefited by using these products as raw
materials

The Chinese are exporting to India a wide range of low-cost consumer goods that have a
mass market in India such as kitchen-ware, textiles, electronic items, furniture, toys,
cosmetics, footwear and accessories. In fact in the last four years, there has been a deluge
of cheap imports

From China tyres, bicycles, watches and clocks, toys, plastics and dyes, and bulk drugs
In the very near future Indian scooter and motorcycle manufacturers are going to face
stiff competition from the Chinese. The sector that will be worst hit will be the smallscale
sector. The Chinese export import corporations are financially stronger, have more
efficient processes and turn out goods at extreme

(2.6)For the purpose of import goods have been divided into following categories:

Prohibited goods are not permitted to be import at all.

Restricted goods can be imported against a license or subjected to certain conditions.
Canalized goods are permitted to be imported only through state trading enterprises.
Free goods are goods which can be import it without any license or conditions.

Chapter- 3
 IMPORT DOCUMENTS

(3.1). Importer Exporter Code (IEC) Number: No person can import goods without
obtaining an Importer-Exporter Code (lEC) Number unless he has been specifically
exempted. The IEC Number is obtained from the Regional Licensing Authority. You
have already learnt the procedure of obtaining IEC Number in Unit.

(3.2). Bill of Entry: It is a document on which clearance of imported goods is affected.

All goods discharged from a vessel, from foreign or coastal ports are cleared on Bill of
Entry in the prescribed form. The Bill of Entry form has been standardized by the Central
Board of Excise and Customs.

Four copies of bill of entry are submitted. Original and duplicate for customer
departments, triplicate is owner's copy and the fourth copy is for the purpose of foreign
exchange to be submitted to bank. There are three types of Bill of Entry as discussed
below:

I) Bill of entry for home consumption (white in colour): where an importer wants to
get his goods cleared in one lot, he has to present the Bill of entry for home consumption.

ii) Bill of entry for warehousing (into bond, yellow in colour): Where an importer
wants to shift goods to a warehouse and thereafter gets his goods cleared in small lots, he
has to present 'into bond' bill of entry. Reason may be that he is unable to pay duty
leviable on all goods at one instance or may be because of storage problem.

iii) Ex.-Bond Bill of Entry (Green in Colour): When an importer wants to remove
goods from the warehouse, he has to present an Ex-bond bill of entry which is green in
colour.

a. Bill of Entry is not required in the following cases:

b. passengers baggage favour parcels
c. Mail box and post parcels
D. boxes, kennels of cargos containing live animals or birds
E. unserviceable stores, e.g. dunnage wood, empty bottles, drums etc. of reasonable value
F. ship’s stores in small quantities for personal use
G. cargo by sailing vessels from customs ports when landed at open bundles only

For imports through the medium of post there is no bill of entry. Instead a way bill is
prepared by the foreign post office for assessment of duty.

(3.3)RETIREMENT OF IMPORT DOCUMENTS:

(a) Loading of Goods and Receipt of Shipment Advice: - On loading of goods the
overseas supplier dispatches the shipment advice to the importer informing him about the
shipment of goods. The shipment advice contains invoice number, bill of lading, airways
bill number and date, name of the vessel with date, the port of export, description of
goods and quantity and the date of sailing of the vessel.'

(b) Retirement of Import Documents: - After shipping the goods, the overseas. 40'
supplier prepares the necessary documents as per the terms of contract’ and letter of
credit and hands them over to his bank for their onward negotiation to importer in the
manner as specified in the L/C. The set normally contains bill of exchange, Commercial
invoice, bill of lading, packing list, certificate of origin, marine insurance policy, etc.

For the retirement of documents, the importer is required to submit the following
documents to his bank:

(a) A letter authorizing his bank to debit the equivalent Indian rupees to the value of
documents including bank charges.
(b) Exchange control copy of the Import Licence, if applicable. Form Al duly completed
for the remittance in foreign excl1ange.

c) Acceptance of the bill of exchange: - bill of exchange accompanied by the above

documents is known as the Documentary Bill of Exchange. It is of two types:-

Documents against Payment (Sight Drafts):- In case of sight draft, the drawer instructs
the bank to hand over .the relevant documents to the importer only against payment.

Documents against Acceptance (Usance Draft):- In case of usance draft, the drawer
instructs the bank to hand over the relevant documents to the importer against his
'acceptance' of the bill of exchange.

(d) Scrutiny of Documents Received under L/C:- After receipt of import documents
from the exporter's bank, the importer's bank will scrutinise the documents as to their
correctness as per the terms and conditions of L/C and hands over them to the importer
after payment. The importer should also scrutinise the documents and ensure that there
are no discrepancies.

(e) Appointment of C & F Agent: - In India, the procedure for clearance of imported
goods is very lengthy, time consuming and involves lots of legal formalities. Therefore,
it is advisable to hire the services of C&F agents who are well versed with such
formalities. The C&F Agent prepares the bill of entry containing details of goods to be
cleared from the customs. In case, the C&F agent does not have relevant information
about the goods to be cleared, he prepares a bill of sight in order to enable himself to
physically check the goods imported and prepare bill of entry on that basis.
(3.4) CLASSIFICATION OF GOODS FOR IMPORT POLICY & ASSESSMENT
OF DUTY

Most of the goods imported are assessed and valued for calculation of import duty
provided they are imported in terms of the Import Policy and evaluated for calculation of
customs duty by virtue of the nature of goods or by virtue of its end use. The imported
goods, which do not fall in parameter of the Import Policy, are' normally confiscated or
allowed to be cleared only on payment of heavy penalty. Types of Customs Duties

The following types of Customs Duties are levied on goods imported into or exported out
of India:

(a) Basic Duty; - Basic duty is levied on all goods imported into India as prescribed in
Schedule-I of Customs Tariff Act. This duty is levied as a percentage of value of goods
imported or at a specified rate.

(b) Auxiliary Duty; - This duty was levied in addition to the basic duty prescribed under
the Finance Act every year. However, with effect from 28th February 1993, the
government has withdrawn auxiliary duty.

(c) Additional or Countervailing Duty; - This duty is levied on the total cost of
imported goods at the rate equal to excise duty on like goods when manufactured in
India. This duty is levied to protect the domestic industry.

(d) Specific Duty: - This duty is levied in order to counter balance the excise duty
leviable on the imports going into the production of such goods in India.

(3.5) Mode of Levy of Customs Duty:

(a) Specific Duties: - Specific duty is a duty imposed on each unit of a commodity
imported or exported. For example, Rs.5 on each meter of cloth imported or Rs.500 on
each T.V. set imported. In this case, the value of commodity is not taken into
consideration.

(b) Advalorem Duties: Advalorem duty is a duty imposed on the total value of a
commodity imported or exported. For example, 5% of F.O.B. value of cloth imported or
10% of C.LF. Value of T.V. sets imported. In this case, the physical units of commodity
are not taken into consideration.
(c) Compound Duties: - Compound duty is the combination of specific and Advalorem
duties. In this case, the quantities as well as the value of the commodity are taken into
consideration while computing tariff. For example, 5% of F.O.B. value plus, 50 paisa per
meter of cloth imported.

(3.6) Valuation of Goods:

Valuation of goods is done as per principles and down in Customs Valuation
Determination and Prices. Of Imported Goods) Rules, 1998.

(3.7) Demurrage Charges

The goods imported and discharged in the Customs area are stored in the warehouses of
CWC or Port Trusts or other designated authority. Initially, such goods are allowed to be
stored freely for few days and thereafter demurrage or storage charges are levied. The
“Free Period" for different cargo is different as under:-

(a) Commercial and Non-commercial Cargo: - 7 calendar days from date of landing.

(b) Unaccompanied Baggage: - 14 calendar days from date of landing.

Direct Delivery Facility for Imports by Air: - The facility of 'Direct Delivery' of goods
imported by air-is allowed in certain cases:

(a) Goods like fresh fruits, frozen food, life saving drugs and appliances, TV films;

(b) Any cargo requiring special handling or storage; and

(c) Any cargo in respect of which order of the Deputy Collector of Customs, Air Cargo
Unit, have been obtained in advance permitting direct delivery.

(3.8)BILL OF ENTRY

The bill of entry is a document, prepared by the importer or his clearing agent in the
prescribed form under Bill of Entry Regulations, 1971, on the strength of which clearance
of imported goods can be made.

When goods are imported in a particular country, the importer has to pay the necessary
import duty. For this purpose, necessary information about the goods imported must be
given to the customs authorities in a prescribed form called bill of entry form. Bill of
entry is a document, which states that the goods of the stated values and description in the
specified quantity have entered into the country from abroad. The bill of entry is drawn in
triplicate. The customs authorities may ask the importer to supply other documents like
invoice, broker's note and insurance policy, etc., in' order to verify the correctness of the
information supplied in the bill of entry form.

Types of Bill of Entry:

For the purpose of giving information in the bill of entry form, goods are classified into
three categories namely:

(a) Bill of Entry for Goods Imported for Home Consumption (White colored):- This kind
of bill of entry is used for clearing imported goods by paying customs duty at the port.
(b) Bill -of Entry for Bonded Goods' (Yellow colored):- This kind of bill of entry is used
when no duty is paid on imported goods and, therefore, they are transferred to customs
recognized bonded warehouses.
(c) Bill of Entry for Ex-bond Clearance for Home Consumption (Green colored):- This
kind of bill of entry is used where the importer intends to clear the dutiable goods, either
in part or full, from a bonded warehouse by paying necessary duty.

Contents of Bill of Entry

The main contents of the Bill of Entry are:

(a) Name and address of the importer.
(b) Name and address of the exporter. .
(c) Import licence number of the importer.
(d)Name of the port/dock where goods are to be cleared.
(e) Description of goods.
(f) Value of goods.
(g) Rate and amount of import duty payable.
(h) Other relevant documents.

However, no bill of entry is required in the following cases:

(a) Passengers' baggage;
(b) Favour parcels;
(c) Mail bags and Post parcels;
(d) Boxes, kennels of cages containing live animals or bird~;
(e) Post parcels ship stores in small quantities for persona, use.
(f) Un-serviceable stores, such as, dunnage wood, empty bottles, drums, etc., of
reasonable value (below Rs. 50);
(g) Cargo by sailing vessels from Customs Ports when landed at open bunders only.

PROCESSING OF THE BILL OF ENTRY

Once the Bill of Entry is completed by the Appraiser, and the same has been
countersigned by the Assistant Collector, then it is forwarded to the License Department
for debit and audit, and thereafter returned to the importers for payment of duty in the
Accounts / Cash department. After recovery of duty, the original Bill of Entry is retained
in the Accounts Department and the duplicate and other copies are returned to the
importers for getting the goods examined in the docks. In the Docks, Shed Appraiser /
Examiner shall examine the goods, and if the consignment is in order, he will give the out
of charge for payment of the Port Trust Charges. This procedure under which 80 to 90%
of the consignments are being cleared is known as the Second Check Procedure. As
against this, in the alternative procedure what is known as the First Check Procedure, the
Scrubnising Appraiser in the Group gives the examination order. The goods are then
examined in the docks and the Bill of Entry returned to the Scrutinizing Appraiser for
completion and licence debit. In this case, the Customs out of charge is given by the
Accounts Department soon after the recovery of duty. This procedure is resorted to only
in cases where the appraisers or the assessing Group finds it difficult to complete the
assessment on the basis of the documents made available.

The import consignment can be opened only by the proper officer of the customs for
examination of the goods lying in a Customs Area. Examination of cargo for assessment \
purpose is chiefly the function of the Appraising Department having special staff of
Examiners in the docks / Air Cargo shed.

'The result of the examination or weighment is noted on the reverse of the Bill of Entry.
It is absolutely essential that records of examination and weighment should be made,
attested and dated at the time of examination or weighment. If examination or weighment
takes place on more than one day, the result of examination or weighment made on each
is clearly recorded. The Officer at the same time, obtains on the documents the
importer's or his accredited representative's signature on the entries made from day-to-
day showing the result of weighment.

(3.9) A NOTE ON FORWARD CONTRACT

International contracts are either concluded in Indian rupees or in foreign currency. If the
contract is concluded in terms of Indian rupees, all relevant documents are prepared in
Indian rupees and hence no conversion is involved. However, if the contract is concluded
in some internationally accepted currency then the importers have to pay Indian rupees
equivalent. To the amount of foreign currency. Where the international contract has been
concluded in foreign currency, an importer is always at risk due to adverse fluctuations in
the exchange rates in the international market. Such risks can be avoided by the following
methods:

(a) Invoicing the Goods in Indian Rupees: - The first remedy to adverse movements in
exchange rates is invoicing goods in Indian rupees. However, foreign seller may not
agree to invoicing goods in Indian rupees.

(b) Entering into a Forward Exchange Contract: - This is the most commonly practiced
alternative for insuring the risks arising out of adverse movements in exchange rates.
Under this adjustment, the importer enters into contract with its bank to purchase from
the bank, foreign exchange at a future date or period and the bank agrees to sell the firm
the foreign exchange on that date or during the agreed period at certain predetermined
rate agreed upon at the time of entering into contract. Thus, the importer knows in
advance the exchange rate that he is going to pay on delivery of import documents.
 Chapter-4

Import Products From China

(4.1) Introduction:
We are importing many products from China because products are very cheaper than
Indian market and they fullfill the needs of our citizens Because of cheaper prices
products made in China are becoming more popular among the Indian masses.
Cheap chinese products are kind of relief to the lower middle class in India. Companies
operating in India are facing a good competition against these chinese products as In
india middle class consumer market is very big which got badly affected because of these
products.Well consumer are basically two types -one who wants best features at
affordable prices, and the others who go with quality and brand tag. Chinese product have
benifitted the consumers of first category.
There is a huge demand in India for low-cost, less durable consumer goods, from China.
These goods are very popular with people who wish to buy the fake versions of their
favorite brands at throwaway prices.

These products are being sold at the cheapest rate and wages of poor people has not beein
raised, therefore, they stick to these products due to their poverty.

(4.2) There are many types of products which we Import such as:

Products
• Agriculture & Food
• Apparel & Accessories
• Arts & Crafts
• Auto Parts & Accessories
• Bags, Cases & Boxes
• Chemicals
• Computer Products
• Construction & Decoration
• Consumer Electronics
• Electrical & Electronics
• Furniture & Furnishing
• Health & Medicine
• Industrial Equipment & Components
• Instruments & Meters
• Light Industry & Daily Use
• Lights & Lighting
• Manufacturing & Processing Machinery
• Metallurgy, Mineral & Energy
• Office Supplies
• Security & Protection
• Service
• Sporting Goods & Recreation
• Textile
 • Tools & Hardware
• Toys
• Transportation

Some Important Products which we import in huge quantity are as :

(4.3) Agriculture and food products:-

Introduction:

China is the world’s sixth largest economy and its most populous country, home to 1.3
billion people or 21% of the Earth’s total population. But it faces a major challenge in
providing its people with food – China has only 10% of the world’s arable land and only
one quarter of the average world water resources per person.

Agricultural reform has therefore been a major pillar of the fundamental economic
reforms undertaken by China since 1978, resulting in a gradual transition from a centrally
planned economy towards a socialist market economy. The commune system was
replaced by one where individual families lease land from the collectives, ensuring that
almost all rural households have access to land. Then, rural industries started to expand
and absorbed a large part of farm labour. The reforms have achieved a sharp rise in
agricultural production together with a dramatic fall in poverty and a significant
improvement in the amount and quality of food available.

Related products are:

(4.3.i) Frozen Vegetables :

(Frozen Vegetables )

Frozen green bean, frozen broccoli, frozen green peas, frozen green asparagus, frozen
spinach, frozen chopped spinach, frozen taro, frozen green pepper slices, frozen
cauliflower, frozen lotus root, frozen Romano beans, frozen black fungus, frozen diced

(4.3.ii) Food Plastic Bag

Product Description
Features Specifications: Plastic Lamination Pouch/plastic bag/lamination bag/food bag/
Vacuum pouch/packaging bag

1) Material: Lamination from high quality BOPP, PET, PA, CPP, AL, PE for the
packaging bag

2) Suitable for dozens of food packaging, pet food, beverage, agriculture, daily
Chemical products and tea packaging
3) Good printing quality, low temperature heat sealing property, high transparency,
Excellent moisture, oxygen and gas barrier.
(4.4) Electrical & Electronics products :-

Introduction:

: India is heavily dependent on imports of electronic goods from countries like the US
and China to meet its domestic demand. "Meagre spending on R&D by electronics
industry has increased India’s dependence on electronics imports .

India had imported electronics goods worth USD 19.77 billion in the recent times, while
the export earnings were USD 3.17 billion, the study said adding that more than 70
percent of electronics appliances demand is met through imports."...more than 35 percent
of electronics appliances imports in India are sourced from China,"

Related products:

(4.4.i) AC Motor (YB2 Seires Explosion Proof Motor)

Introduction:

AC Motor (YB2 Seires Explosion Proof Motor)

Model NO.: YB2

Standard: IEC
Productivity: 5000/month
Unit Price/Payment:TT or L/C at sight
Trademark: kailida
Usage: Industrial
Power Source: AC Motor
Structure: Asynchronous Motor
Function: Driving

Product Description
AC Motor (YB2 Seires Explosion Proof Motor)
(4.4.ii) Car Refrigerator (DC-22Y)

Introduction:
Car Refrigerator (DC-22Y)

Packing: normal standard package

Model NO.: DC-22Y
Standard: W509*D310*H394MM
Productivity: 2000pcs/month
Unit Price/Payment:FOB Foshan, guangdong
Trademark: colku
Origin: foshan, guangdong, china
Min. Order: 1*20'GP
Transportation: ocean shipping
Capacity: 11-20L
Certification: CE
Voltage: 12V

Product Description
Car cooler/mini cooler/cooler box/car fridge/Compressor refrigeratro/car
refrigerator/mini refrigerator/portable refrigerator/outdoor cooler

Features
Extremely powerful DC compressor cooling system. Boundless independence for all
outdoor enthusiasts Silent and convenient cooling comfort anywhere. Multifunctionally,
fridge and freezer all in one, Extremely high reliability and long life expectancy.
Polyethylene rotomoulded body, unbreakable & rust free, Digital control with LEC
display. Compact overall size, easily accommodate anywhere.

Item no. DC-22Y

Temperature -18~10° C(40~45° C below ambient)
Rated Voltage AC 230V/50~60Hz or 110V/60Hz
Power Input DC 63W
Cooling type DC Compressor cooling system
Refrigerant R134a (CFC-Free)
Isolation C-pentane (CFC-Free)
Weight 13KG/net, 15KG/gross
Unit Size W509*D310*H394MM
Packing Size W532*D376*H455MM
Loading Quantity 330pcs/20GP, 660pcs/40GP, 660pcs /40HQ0.

(4.4.iii) Air Conditioner

Air Conditioner
Product Description
COP>4.5, powered by 48/24VDC,
* This series products can be widely deployed for elclosed area climate control such as
wireless communication caniet, battery cabinet, industry control cabinet etc.
* the internal and external interface of product is IP 55 level to avoid moisture, dust,
water penetrating into inside of enclosure, inside electronics equipemnt is completely
well protected.
* applicable for severe ambient environment, such as high temperature, high humidity,
high corrpsion atmosphere.

Product design feature

* less dehumidifying comparing traditional air conditioner
* environmental friendly refreigerant such as R134A
* heat pressure smart control function to enable active cooling work in winter season
* completely safety protected accordingly UL, EN, CCC norms
* alarming output to monitoring system
* interchangeable and visual display adapter for service
* automatic self start after power recovery
* remote control through RS485 comm. Port
* proper design for easily intallation and service
* side/door mounting
* applicable for T3 condition
(4.4.iv) Bluetooth Car Kit (ESB302)

Introduction:
Bluetooth Car Kit (ESB302)
Packing: Blister
Model NO.: ESB302
Standard: CE, ROHS
Productivity: 100K/Months
Origin: Shenzhen, China
Min. Order: 500PCS
Type: Bluetooth Car Kit
Export North America, South America, Eastern Europe, Eastern Asia, Western
Markets: Europe,India

Product Description
- Safe Driving with entertainment
- Steering wheel Bluetooth Car Kit with DSP, support Bluetooth hands-free phone call
- CRS Bluetooth version 2.0+EDR
- LCD Display for caller ID, frequency, sequence, etc
- Support last phone call redial
- Built-in speaker and Micro-phone for phone talking
- Wireless headset for privacy phone call also with earphone jack
- Built-in re-chargeable battery
- Built-in FM Transmitter with 206 preset channels
- Play MP3 from TF or SD card in With TF or SD card slot in car stereo system

(4.4.v) Solar System Battery Series 12V100S

Introduction:
Solar System Battery Series 12V100S
Model NO.: 12v100S
Trademark:LONGWAY

Product Description
Model: 6fm100g(12v100ah/10hr)
size: 327*170*216 (total height 223 ) mm
more size available
terminal: b
10hr: 105ah
packing qty: 1 pcs/ctn
750 pcs/container
lead-time: 15 days for one container
application: ups, inverter, solar system
oem acceptable
battery 12v100ah: 105ah/10hr
hs code: 85072000
trademark: long way
model:12v100ah
standard:jis iec
productivity: 40,000 pcs
unit price/payment: fob cif cnf/tt or l/c at sight
origin: guangdong, china
packing: 1pcs/ctn
min. Order: 60 pcs
transportation: by sea

(4.4.vi) Offset Dish Antenna (YH45KU-IV)Satellite 45cm

 Introduction:
45cm Offset Satellite Dish Antenna (YH45KU-IV)
Model NO.: YH45KU-IV
Standard: CE & UL
Productivity: 200, 000pcs/month
T/T in advance or
Unit Price/Payment:
L/C
Trademark: Yoohon

Product Description
Material: Steel board
Surface: Polyester powder coating
Short axle: 45cm
Long axle: 49.5cm
Ku waveband gain at 12.5GHz: 34.22dB
F/D radio: 0.6
Focal distance: 270mm
Stand: Wall and/or ground mount
Angle of elevation: 0 to 90º C
Level: 0 to 360º C

Wind speed:
Can receive: 25m/sec
Can replace: 40m/sec
Working temperature: -40 to +60 C
Top of Form
Bottom of Form

(4.4.vii) Radio With USB And SD (GF-723)

Introduction:
Radio With USB And SD (GF-723)
Model NO.: GF-723
Min. Order:1600pcs

Product Description:
Am/fm 2 band radio
USB function, with sd
DC: 6v

(4.4.viii) Appliance World and Home Theater - The World Of

Electronic Goods!

Appliance and World and Home Theater is the safest option if they
are looking for electronics and other appliances. The store known
for its quality products is one of the leading electronic stores . The store offers the best
prices and products to its customers. The products of almost all the leading brands can be
found here. From Whirlpool to LG to GE, the products of all big brands are available
here. The staff is very friendly and cooperative and they make sure that their customers
get the best offers. Appliance World and Home Theater is thus the obvious choice for the
people of our country. Its products are of supreme quality and extremely durable. It's hard
to find better products than what one gets at this store. From dishwashers to microwaves
to refrigerators, the store offers the best in everything. The latest models are displayed
here and customers can carefully look at all of them before choosing what suits them the
best. Everything related to their stores can be found out on the website. From the store's
address, nearby landmarks to its phone number, everything can be traced from the site. A
site map is also present which describes the routes in detail. All this makes it easier for
the customers to locate the store. The site also tells the timings of the store so that people
can plan their visit accordingly. It mentions the days on which the stores are closed to
avoid any inconvenience.

(4.5) Other Products

(4.5.i) Fake Brand Shoes

Detailed Product Description
Beautiful seasons,fresh products! With our fashionable brand
shoes, you will make this season more wonderful.
The shoes of Dunk, Nike, Jordan, Bap Air force can give your feet a comfortable and
easy home!
Popular shape, fashion design and various colors show you a perfect picture.
Many choices are prepare for you,no matter you are men, women or kids.
So pls quickly visit to our website for these lovable leisure prodcucts. and tell me your
idea with by your convenience.

Chapter – 5

Chinese Market in India

(5.1) Introduction:

Been to a market which glows with Bright Red Color in the morning and light bulbs in
the night. If not, then this is the market where you should go. Filled with Red color
products, be it electronic items, toys, dolls, dresses, carpets or curtains. A variety of
products can be found in the Chinese Market.

With the Indian Market flooding with Chinese Goods, this is one place where Chinese
Goods are sold at length. Brightly colored, cheaply priced and good to use for a couple a
months, these are liked by the people who cannot afford very highly priced products or
by those who do not have a long term use of the particular item.

(5.2) Location : Chinese Market is located near the Kirti Nagar Mall of Old Delhi. It can
be easily reached by cabs or taxis.

Fast Facts
City Name - New Delhi
Market Name - Chinese Market
Famed For - Chinese Products.
Language Spoken - Hindi, English, Chinese
Best Time to Visit - November to February

(5.3) Shopping Spree in Chinese Market :

» Meena Bazar- This Market opened by Noor Jahan for the ladies, still stands today;
though the look and the products sold here have changed with the time. Perfumes,
Artificial Jewellery, Leather Products, Souvenirs and Traditional Dresses are the main
attractions of Meena Bazar.

» Chinese Bizaree- The first name which comes with the Chinese Market is the Toys.
Bright red colored toys with the combination of yellow and Green, its one of the places
where you can really buy Cheap Toys for almost all ages. Then there are the clothes -
polyesters and tervinyls are names here to be found in every second cloth shop. There is
another thing for which Chinese Market is famous for - Electronic goods. Almost every
electronic good can be found here - spare parts, sockets, wires, full pieces all are here.
The prices of these items are also very cheap but there is no warranty for these goods.
How long they will work is no ones headache. But there is one Guarantee - even if the
Electronic good works for a day, then it will be the best !

Chinese Market is usually crowded, with lots of people coming here on an average. With
them comes the noise and the voices of thousands of feet - but that is the main attraction
of the Delhis Chinese Market.

(5.4) Suggestions:

Chinese Market is all about second grade Chinese Products. None of the Indian Products
can be found in the Chinese Market.
Chinese Products are cheaply priced but they have no guarantees. Its upto you to buy
them.

All the Electronic items sold in the Chinese Market, come with one agenda - use and
throw. Toys can be purchased from here.

Some of the average Restaurants and eating Joints can be found here. But its preferable to
have food in your Hotel.

If you are coming to the Chinese Market, then make a half day plan to see the entire
Market. As there will be all time walking, then there should be some time to rest.

If you are shopping in the months of March to June end, then its best to shop in the
evenings after 6 o'clock.

Beware of the Thugs in the Chinese Market. Things once lost cannot be recovered
because of the huge Crowd in the Market. Its better to leave the Valueables like passport
in the Hotel Locker.

Money Converters can be easily found in Delhi City. However, its difficult to find them
in Chinese Market and the around areas. However, you may find one or two Branches of
Western Union in the corners or else you can go to Bank of India and State Bank of India
for Money Conversion.

Chapter 6

Impact of Chinese products in India:

Introduction

(6.1) Impact on our Economy:

Cheaper prices products made in China are becoming more popular among the Indian
masses. This has had a very negative effect on our own manufacturing units and as a
result many of them have had to shut shop.

The Chinese goods have invaded almost all the sectors of Indian market and seem to be
bringing tougher times for the Indian Industry. Because of wide availability of cheap and
apparently technologically advanced Chinese goods, many economists fear decline of
local manufacturing units or the small-scale industry in India. The rise in demand and
sudden popularity of Chinese products, which are available at cheaper prices, is giving
nightmares to the Indian industry to the extent that they have started sticking “Made in
China” stickers on their products to boost their sales.

Chinese manufacturing units produce goods on a large scale. They are using the big
Indian market merely to dump their products and by doing so they are killing the Indian
units. For example last year during Diwali, China made crackers were sold in the Indian
market. These crackers reportedly contained Sulphur. Sulphur is more harmful than
Nitrate, which is used in India to make crackers. Since the Chinese crackers were cheaper
than the Indian crackers, so they managed to attract gullible and largely illiterate Indian
lot. As a result the Indian cracker industry saw a decline in the revenue.

China is our major competitor in sectors like software, hardware, electronics etc. We
should not allow China to dump their excess produce here. The small-scale industry (SSI)
contributes 35-40 per cent to the total manufacturing in India. So it is the SSI, which
suffers most because of Chinese goods. For instance, data reveals that 60 per cent of the
industrial units in the industrial belts of Thane and Bhivandi near Mumbai have been
closed down. Many small-scale Indian companies have stopped manufacturing their own
goods as now they import them from China. That’s why many Indian workers have lost
their jobs. This shows that the objective of SSIs of providing employment to the rural
youth of India is defeated completely.

In the last one decade Chinese labour has developed the skills of manufacturing
electronic goods like semi-conductors, telecom equipment, power equipment etc, which
helped them to capture big markets of America and Europe. It is no surprise that they
have been successful in capturing the Indian market too. Although Indian labour can meet
these challenges by improving their skills, the Indian manufacturing scenario is hampered
due to stringent and weak labour policies.

It is the high time that our political leaders change their mindset and bring about the right
kind of reforms without losing precious time in endless discussions. We must take
necessary steps so that we do not fall prey to the DRAGON’s designs of capturing a
major share of our growth, which could prove to be a setback for our economy in the
future.

(6.2) Cheap imports may hit India's steel market:

 India — China’s decision to cancel export duty on some 102 steel products could see it
flood Indian markets with cheap priced steel items, the Indian steel industry feels.
The industry is already reeling from falling demand, crashing prices and high
production costs.
China, the world’s largest steel producer, announced two weeks ago that it would remove
the 5 percent levy on steel exports from December 1, to boost its steel industry, which has
been severely hit by the global slowdown.
According to industry sources in India, exporters in China have started shipping steel to
India at “ridiculously low prices,” in a bid to clear stock. Due to the removal of the export
duty, Chinese steel prices, currently, the cheapest in the world will encourage already
sliding local demand to shift to Chinese imports.
“The current global economic slowdown has led to a decline in the demand for steel and
thereby the prices, whereas, the prices of raw materials for steel industry have remained
firm over the period, affecting the viability of the sector. Leading steel companies like
Steel Authority of India and JSW Steel have reported 25 to 30 percent dip in
consumption demand and have, consequently, resorted to production cuts.
However, the local steel industry faces a much harder blow from imports. According to
the steel ministry, India’s steel imports have shot up 50 percent to about 3 million tons
from April to September last year, compared to the same period last year, out of which at
least a million ton came from China. “The fear is that with China taking measures to
boost exports and with no adequate protection within the country, much more of Chinese
steel will start entering in the next few months impacting the local market severely..
In a recent address to the industry, minister for steel, Ram Vilas Paswan said that at the
current rate of imports, India may end up importing 6 million tons of steel by March 2009
accounting for over 10 percent of its current steel production, which is 58.64 million tons.
The reason why India is scared of China the most compared to other steel exporters --
after all India also imports steel from Ukraine and Taiwan where prices are almost as
cheap -- is the fact that China’s steel industry too is suffering from excess production and
falling consumption, which are forcing it to adopt aggressive measures to ship out
existing stocks.
According to Market Avenue, a Beijing based business intelligence outfit, China will add
50 million tons to its steel production capacity this year, which will take its total output to
400 million tons by the end of the year.
But, even as China is producing capacity relentlessly, its consumption is taking a hit.
Steel Business Briefing, a China-based steel consultancy outfit predicts that steel
consumption in China will grow by only 8-10 percent in the second half of next year, as
little as half the 16 percent growth seen in 2008.
Nevertheless, heeding the industry pleas for taking it out of a “serious situation,” India re-
imposed a duty of 5 percent on steel imports last week. The duty was removed six
months ago to stall steel prices in the country that were ruling at all-time highs of over
US$1,100 per ton. Moreover, import restrictions were also imposed on some items of
finished steel products like seamless tubes and pipes from China.
Still, the industry says, that’s hardly enough. “The 5 percent (import) duty may not be
adequate because despite the duty, the landing cost (of imports) is lower than the
production cost of local steel makers. While China is offering steel at US$440 per ton,
domestic prices in India are ruling at almost US$700. So, the latest duty would push
import cost by just US$22 per ton.

(6.3) Cheap Chinese goods harming Indian industry:

The government is taking measures to counter the threat posed to the domestic
manufacturing sector in India, especially from the small and medium scale segment, from
cheap and subsidised Chinese products, the commerce ministrys said today.
India imposed anti-dumping duty on Chinese goods in 22 cases, including final duty in
12 cases and provisional duty in 10 cases, during 2008-09 and 2009-10 (up to November
2009). Final safeguard duty was imposed in 4 cases during the two years, a government
release said today.

These duties are in accordance with the Agreement on Anti-Dumping (the agreement on
the implementation of Article VI of GATT, 1995), the agreement on subsidies and
countervailing measures, and the agreement on safeguards, the release said.

These provisions are aimed at offsetting the adverse effects of 'dumped' imports,
'subsidised' imports or 'increased' imports, it added.
India's merchandise imports from China doubled during the last 3 years to Rs1,47,605
crore ($32.05 billion) during the financial year 2008-09 from Rs1,09,116 crore ($23.69
billion) in 2007-08 and Rs79,008 ($17.16 billion) in 2006-07.

The government said trade defence measures are available to the domestic industry to
counter unfair trade practices followed by exporters of goods from other countries.
In case a product is imported into the country at less than its normal value, and it causes
injury to the domestic industry, the domestic industry can make an application to the
Directorate General of Anti-Dumping and Allied duties (DGAD) in the department of
commerce for imposition of anti-dumping duty, the release said.

Alternatively, the affected industry or unit can make an application for imposition of
safeguard duty to the Directorate General of Safeguards under the ministry of finance, in
case there is serious injury/market disruption, or threat of series injury/threat of market
disruption to the domestic industry, as a consequence of increased imports of an article
into the country, the release added.

Under section 3 (2) of Foreign Trade (Development and Regulation) Act, 1992, the
central government has an inherent power to impose restrictions on import of goods.
The Customs Tariff Act, 1975 includes provisions for providing relief to the domestic
producers against injury caused to them by imports.
(6.4) Why are we Importing electronic products from china?

Wholesale Electronic Products - Reasons to Buy From China

China is now being considered as one of the biggest giants in producing electronics items
in reasonable price range. Therefore, those in trading business of imported electronic
items may find it convenient to have electronics goods buy from China. Even
international locations like USA and some European traders are importing electronics
items from China at regular basis. Consistent supply, good quality, and reasonable price
are three pillars of electronics export market of China.

If a business unit wants to buy from China at wholesale rate, it has to follow some easy
methods of import. Because of the flexible import policies, business with China is easy
and hardly needs any special effort to run the business under smooth spell. The
electronics goods from China are of good quality and highly affordable thus proves cost-
efficient for trading. The market trend of China has reached at its full pace due its wide
array of goods, especially of electronics items, which is manufactured at the fraction of
its regular cost with accuracy and precision.

However, in case of electronics products, the one of the prime reasons to buy from China
for the importers is its good and consistent quality in spite of its low cost. In the same
category products from Japanese origins are costlier as well as import policies are not that
flexible as China policies. If an importer approaches China ship agents to coordinate the
import sale deal it has provision for minimizing over all cost for the entire business
transaction. However, it is always better to skip the involvement of middlemen in the
course of the import business otherwise unit price for the electronics item will be higher.

While planning to purchase from China, it is always recommended to contact China

vessel agents and they can help the importer to find out the best possible deal in terms of
price in electronics products. In short, for running import business, the involvement of
shipping agent will help to keep the wholesale electronic goods prices at the lowest
range. On the other hand, the combo of quality and aesthetics has kept the demand of
China electronics products ahead of other products of the same category.

Recent research and study have shown the fact that the technological advancement of
China electronics industry has made the production quality of China with South Korea,
Japan, and even with the electronic goods made in Taiwan and it has merged as one of
the leaders in Asian force of electronic consumer goods industry in 21st century. Besides
this ranking, China is ranked as one of the most eye-catching consumer market on
electronics items from the investment point of view. These statistics has expressed the
facts that China export market of consumer electronics item has taken a steady pace and
it is worth importing consumer electronics item from China.

China has been now tagged as the world factory of electronics goods item at reasonably
lower cost; the low- set up cost to low- labor cost and corporate low tax level has helped
the price tag to be on the lowest side and good quality against low price factor has
emerged as one of the main reasons to buy from China market for the importers across
the world.

(6.5) Chinese Handsets Flooding the Indian Mobile Stores:

The Indian mobile phone market is flooded with new handsets every week. Makers from
all over the world are recognizing the potential of the Indian markets. Manufactures are
adhering to the needs of the people and are customizing their handsets to suit the Indian
buyers. The urban market has been exploited and the penetration is soaring this is evident
with the growing number of mobile stores. The semi-urban and rural markets are next in
line to avail this convergent medium of communication.

The low priced Chinese handsets are becoming an easy buy for the Indian consumers.
The lifestyle handsets are not yet preferred of Chinese origin but the entry-level ones are
highly popular. The cheap pricing with basic functions suits the routine of the semi-urban
and rural crowd in India. While most unaware of English language the Rs. 800 handset
from Spice mobile has no display screen but a voice based application which helps in
dialing numbers.

The mid-range handsets are not yet popularized by the Chinese products and so is the
higher end range. The buzzword in the Indian mobile industry is the rural market the
Chinese makers are raking in business and profits. Orpat, a watch making company also
entered the rural mobile market industry by manufacturing their handsets in China. It is
about time when mobile handsets are extensively produced in India. While being one of
the most communication hungry nations it should thrive to start production for the same.

To venture into this obvious growing market mobile phone producers thought of opening
manufacturing plants in India. But due to the bureaucratic structure the process was
elongated. Thus many manufacturers moved their base to China for production. The
Indian mobile phone market is flooded with handsets produced from China but marketed
and sold in India. Even China’s big guns in mobile production like ZTE, Bird
International and Kejian have forayed into the Indian mobile phone market and are
expanding. ZTE has a huge share in the CDMA (Code Division Multiple Access)
market. Most of the entry level, basic utility phones to mid-range phones is manufactured
by ZTE. They supply handsets to players like Reliance Communications and Tata

Teleservices. Even Spice mobile which has been famed for its dual-sim capacity
handsets it also rolling out a series of cheap handsets. These handsets will be priced as
low as Rs. 800. With the kind of technology and marketing the costs could be further
lowered. It is about time we see the rural markets flaunting mobile stores and the
mobiles selling like hot cakes.
(6.6) Chinese goods are creating problems:

China the growing market is producing the cheaper goods and exporting to all over the
world. Many goods are manufactures in china and you can always see Made in china
label even you purchase an electronic DVD or LCD from USA or UK. In China the cost
of manufacturing is very less because of cheaper labour and bulk quantity of the
production. Hence the Chinese goods are much cheaper compare with local products
Because of this every company like Sony, Panasonic etc will manufacture their goods in
China and import them to their countries. Of late many countries are not allowing the
Chinese goods to be imported to their countries. The examples are USA has banned
Chinese toys as these creating health problems to children, the milk powder also banned
Chinese goods are dumped every where, you can see China market every nook and
corner of the country. The most popular goods are plastic , home appliances, watches,
cell phone and even the Hindu gods photos also printed in china. Many people flock to
China markets because of the cheaper cost compare with local goods. Many
manufacturing companies like Auto mobile and tyre are also facing the heat. Many
companies are protesting to ban the Chinese import, the import of Chinese goods are
harming the local markets. The latest is Banarasi saree industry in Varanasi Scores of
handloom weavers took to streets. Varanasi, famous for its world renowned Banarasi
sarees, against the cheap quality Chinese imitation products flooding the market. The
Banarsi saree industry has also been adversely affected due to the import of cheap
Chinese fabric. Powerloom owners have been producing cheap imitation products at
various places, helped by computer-assisted copying of designs. According to protestors
cheap imitation products are doing roaring business while highly skilled weavers who
produce the original product suffer.

"Earlier we used to do good business in Banarasi sarees, but slowly it started falling,
because of the Chinese sarees which are being sold at lesser price than our sarees.
Banarasi sarees require more labour, money and expensive raw material, but people are
selling imitation of Banarasi sarees in cheap quality Chinese material, so our business is
being affected badly. After facing lot of hardship we have today decided to take to streets
as for how long can we go on living in penury?" said Razia Begum, a protester.
According to data available through Non-Governmental Organisations (NGO's) working
with the weavers, the number of people employed in the once thriving industry has
reduced from around 700,000 people to 250, 000 people only.
Imports from China to India had galloped pace from $11 billion to $27 billion in the last
three years. Among all the countries in the world, India imposed the maximum measures
and ordered the highest number of probes (31) into dumping of goods from different
countries, including China, during July 1 to December 31, 2007, according to the World
Trade Organisation.

Chinese products faced the maximum number of anti-dumping measures, accounting for
nearly half (26) of the 58 new measures. China was most frequently subjected to new
investigations, with 40 measures directed at its exports between July and December 2007,
slightly up from the 39 investigations on exports from China that were reported for the
corresponding period of 2006. Sectors that are hit hard with imports from China are
machinery and equipment, chemicals, textiles, base metals and auto components
Solutions
• Government should ban the imports of Chinese goods immediately
• Under intellectual property rights patenting should be encouraged for traditional goods
like Banaras saree, Tanjore painting etc
• People also should not flock for cheaper goods as these good are not good as far as
quality is concern
If correct measures are not taken immediately the manufacturing industry, traditional
industries like Banaras saree will face problems.

Chapter -7

Chinese goods: Boon or bane?

(7.1) Boon or Bane:
The recent flooding of Chinese goods into the Indian market has raised a hue and cry, and
the question whether we should accept this silently. From the narrow viewpoint of the
average consumer, sufficiently satisfactory quality goods are available at roc k-bottom
prices. For instance, the prices of China-made compact fluorescent lamps are less than
the prices of lamps of well-established Indian brands, and of comparable quality.
With the tremendous explosion of communications technology, countries are finding it
increasingly difficult to maintain closed-door policies. Consumers are becoming more
aware of the availability of various technologies. The inefficiencies of companies a re
exposed to competition from efficient enterprises, and the market share of the laggards is
diminishing rapidly.

Traditional manufacturing industries in India were reaping profits at the cost of both
consumers and workers till the early 1960s. With the growth of socialism, the workers
started asserting themselves under the banner of trade unions. Due to this pressu re,
public sector units registered tremendous growth and large private enterprises were also
able to record higher profits.

In the early 1980s, with liberalisation, the majority of non-Left parties, in cooperation
with various industry associations and some economists with `western outlook', started
supporting the idea of globalisation at the cost of national interest.
One basic fact that cannot be ignored is India's large population of diverse culture and
religion. Even China -- with its large area and population -- is not comparable. To keep
the country together with a socially stable set-up, the Indian model of econ omic
development has to be different from traditional Western models.

The right economic model should provide social stability in terms of gainful employment
for the masses. But the new economic model, with the advent of information technology,
has given rise to a new class of people whose salary levels, on the one hand, h ave risen
to dizzying heights and, on the other, reduced the employment opportunities of the
middle-classes.

Organised industry has resorted to employing labour contractors on a daily-wage basis,

bypassing the statutory provisions of facilities and, in effect, reducing the wage levels for
the majority. Even very profitable concerns have lured employees into vol untary
retirement schemes. As a result, people below retirement age, who opt for
superannuation, come back to the job market with the advantage of experience.
This process helped capitalists exploit the toiling millions. The NPAs stand testimony to
how our nationalised banks are being systematically looted to promote a few while
keeping the majority of the workers below the required wage levels.
The government's globalisation policy was welcomed initially by the industry
associations for two reasons: To dismantle the last semblance of labour laws and to divest
PSUs and nationalised banks with the supposed aim of increasing efficiency and removin
g NPAs from their books.
Now, when these industries face the onslaught of globalisation on home turf (in the form
of cheaper Chinese products), they are again pleading that there is no labour law in
China. This parochial campaign must be exposed. With the fruits of the increased sales
by these industries failing to reach the common man, the availability of cheaper Chinese
items definitely spells relief for him.

(7.2) Advantage and Disadvantage of Chinese Products:

Advantages:

(1) Cheaper price benefits the consumer

(2) Cheaper raw materials are beneficial for industries
(3) Importer and trader makes money by selling goods.
(4) Import business leads to some employment generation
(5) Government collects tax by way of customs duty.
(6) It may lead to competition which in turn may lead to better quality products.

Disadvantages:

(1) Cheap imported Chinese products kill competition and local small scale industries
suffer. Sometimes, may close down.
(2) Closure of local industries due to Chinese imported goods, may lead to
unemployment.
3) It may also lead to loss of revenue due to the closure of local industries.
(4) Closure of local industries may also lead to social unrest arising out of unemployment
of staff and employees
(5) Cheaper goods means cheap quality and consumers may suffer on .
 CONCLUSION
I have completed my thesis report on IMPORT OF CHINA CHINESE and found
that documentation and procedure for import is very crucial and important,
without these the export-import can not be done.

Good documentation and procedure of import is very necessary and it should be

execute very carefully and sincerely. The documents and procedure is necessary for
both importer as well as exporter.

REFERENCE
Sites:

www.alibab.com

www.indiatrade.com

www.indiatradezone.com
www.slideshare.com

www.google.com

www.eximindiamart.com

www.importerexporterhelp.com

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