Saturday, January 24, 2009

Ban on import of Chinese toys


New Delhi, Jan. 23- The Centre on Friday banned the import of toys from China with immediate effect for six months.

The Director General of Foreign Trade issued a notification banning the imports of toys from China but did not give any reason as to why this was being done.

While the government notification did not cite the reason for the ban, sources said it was concerned over a rise in imports of toys.

A concern had also been raised over the safety of children playing with the Chinese toys, which were found to be toxic.

Most of the varieties, including wheeled toys, dolls, stuffed toys, toyguns, wooden and metal toys, musical instruments, electric trains and puzzles are covered under the ban.

The Toy Association of India's president, Raj Kumar, said the ban would severely hit imports of Chinese toys, but Indian authorities had likely taken the step in the interest of the economy.

"You see Chinese toys everywhere. The good, upper-end toys are made in India, but the cheap toys in the street and small shops were being dominated by them. They are bringing in toys without safety norms," he said.

Kumar said there had been some discussions between toy manufacturers and the government about increasing import taxes on Chinese toys, but he was not expecting a ban.

Another trade official, who did not want to be identified, said the ban may even hit imports of toy components.

"These components are used by Indian companies to make toys. Some companies that have no manufacturing facility, they only import. What will happen to them. This news has come suddenly. I'm really surprised," he said.

In the face of global downturn, Indian industry has been clamouring for protection from aggressive Chinese manufacturers.

Industry officials said there has been a surge in the import of handicraft and toys by Rs 1,000 crore during April -November 2008.

However, trade expert Arun Goyal said, "The ban would encourage smuggling of toys through Nepal borders. That would be more dangerous... It is bad, especially for the slum children, who an afford the cheap Chinese toys only."

China's manufacturing industry -- a key supplier of toys, apparel and food to much of the world -- has faced a wave of complaints in recent years, most recently as thousands of people have fallen ill as a result of consuming milk powder tainted with melamine, a chemical used to make plastics.


The world's leading toymaker Mattel recalled over 21 million Chinese-made toys worldwide in 2007 due to excessive levels of lead paint and other unsafe components. Also that year, China suspended export of a bead toy that was contaminated with a "date rape" drug, Chinese media reported. Some children who swallowed the beads vomited and lost consciousness.

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Relief likely for crisis-hit apparel exports sector

New Delhi, Jan. 23 The Planning Commission Deputy Chairman, Mr Montek Singh Ahluwalia, would convene a high-level meeting of different government departments on February 5.

The meeting is being called to address the core concerns of the apparel industry, particularly its export segment, badly hit by the ongoing recession in the overseas markets of developed countries, according to the Minister of State for Commerce and Power, Mr Jairam Ramesh.

Garment fair

Addressing the garment industry representatives at the ongoing India International Garment Fair in Gurgaon, Haryana, where over 350 established apparel manufacturers and exporters have been showcasing their speciality wares, Mr Ramesh said that the need for tackling the crisis in the garment industry arose out of the fact that in 2008-09, the garment exports from India would be lower than Bangladesh, while Vietnam would overtake India before long.

While India would end up exporting garments worth $8.8 billion this fiscal, Bangladesh is poised to export $12 billion worth of garments and China (excluding Hong Kong) at $115 billion.

He said that Vietnam would export $6 billion worth of garments this fiscal and would soon overtake India, if “we do not get our act together to improve the competitiveness of the Indian garment industry”.

Women workers

Considering the fact that six million people (a majority of them being women) work in the garment industry, the need for bolstering the industry in terms of safeguarding the livelihood concerns of people working in the industry assumes added significance, Mr Ramesh said.

Hence, he said, the “garment industry needs much more focused support than the real estate sector which some people have been championing”.

Earlier, in a presentation to Mr Ramesh, the Apparel Export Promotion Council Chairman, Mr Rakesh Vaid, said that all major announcements by way of fiscal stimulus measures were either a release of withheld benefits or restoration of benefits recanted lately.

He cited the case of Technology Upgradation Fund Scheme (TUFS) and Central sales tax/terminal excise duty payments and subvention of credit of 4 per cent withdrawn from October of which 2 per cent has been restored now.

He said exports in November were $621 million, a decline of 11 per cent compared withNovember 2007 and this fiscal apparel exports would be $8.78 billion, down 9.4 per cent as compared to 2007-08, he said.

Reviving activity

Pleading for a series of steps to revive activity in the crucial garment industry to help workers survive, the AEPC chief said all duty drawback rates might be notified at the rate of 14.61 per cent effective from September 2008, along with introduction of interest-free loans for investment in machinery and zero duty import of capital good scheme.

Read More......

Relief likely for crisis-hit apparel exports sector

New Delhi, Jan. 23 The Planning Commission Deputy Chairman, Mr Montek Singh Ahluwalia, would convene a high-level meeting of different government departments on February 5.

The meeting is being called to address the core concerns of the apparel industry, particularly its export segment, badly hit by the ongoing recession in the overseas markets of developed countries, according to the Minister of State for Commerce and Power, Mr Jairam Ramesh.

Garment fair

Addressing the garment industry representatives at the ongoing India International Garment Fair in Gurgaon, Haryana, where over 350 established apparel manufacturers and exporters have been showcasing their speciality wares, Mr Ramesh said that the need for tackling the crisis in the garment industry arose out of the fact that in 2008-09, the garment exports from India would be lower than Bangladesh, while Vietnam would overtake India before long.

While India would end up exporting garments worth $8.8 billion this fiscal, Bangladesh is poised to export $12 billion worth of garments and China (excluding Hong Kong) at $115 billion.

He said that Vietnam would export $6 billion worth of garments this fiscal and would soon overtake India, if “we do not get our act together to improve the competitiveness of the Indian garment industry”.

Women workers

Considering the fact that six million people (a majority of them being women) work in the garment industry, the need for bolstering the industry in terms of safeguarding the livelihood concerns of people working in the industry assumes added significance, Mr Ramesh said.

Hence, he said, the “garment industry needs much more focused support than the real estate sector which some people have been championing”.

Earlier, in a presentation to Mr Ramesh, the Apparel Export Promotion Council Chairman, Mr Rakesh Vaid, said that all major announcements by way of fiscal stimulus measures were either a release of withheld benefits or restoration of benefits recanted lately.

He cited the case of Technology Upgradation Fund Scheme (TUFS) and Central sales tax/terminal excise duty payments and subvention of credit of 4 per cent withdrawn from October of which 2 per cent has been restored now.

He said exports in November were $621 million, a decline of 11 per cent compared withNovember 2007 and this fiscal apparel exports would be $8.78 billion, down 9.4 per cent as compared to 2007-08, he said.

Reviving activity

Pleading for a series of steps to revive activity in the crucial garment industry to help workers survive, the AEPC chief said all duty drawback rates might be notified at the rate of 14.61 per cent effective from September 2008, along with introduction of interest-free loans for investment in machinery and zero duty import of capital good scheme.

Read More......

ASEAN-India economic integration faces difficulties

NEW DELHI, India: Most Southeast Asian countries are surrounded by bodies of water and attention so far has focused on improving port-to-port transportation. But more needs to be done before economic integration can be achieved.

There has been a proposal to set up a rail link from Delhi to Hanoi, the capital of Vietnam, passing through Myanmar, Laos, Cambodia and Thailand.

ASEAN nations and India are also working to achieve an open sky agreement, which will allow all flights to travel freely in the region.

For Southeast Asian tourists, the Indian government will soon provide multiple-entry visas.

Former ASEAN secretary-general, Ong Keng Yong, said: "Good thing is that people are thinking about the European idea - after you enter one country in Europe, you can move around. We are looking at that. But it is something we have to continuously pursue because there are so many considerations."

It takes a long time to finish customs clearances, and export and import procedures remain cumbersome, complicated and expensive. Trucks crossing international borders also require immigration controls, customs and quarantine procedures.

Singapore’s ambassador to Algeria, Zulkifli Bin Baharudin, said: "If you have 10 airports, which are well connected to the world, freedom of movement in and out of India, with the infrastructure that comes with it - custom procedures harmonised, free trade zones, understanding of manufacturing process, support of export-oriented industries - I think all that connectivity we talked about will come to fruition."

Besides infrastructure, a lack of political uniformity is also another barrier to ASEAN-India integration.

A military government in Myanmar and the recent political unrest in Thailand have obstructed the trade corridor.

Laws on taxation and banking too differ in each country. Adopting common standards and even a common currency seems unlikely as most ASEAN countries trade with India on one hand, but are also its rivals on the other hand for the import and investment of dollars in the rest of the world.

ASEAN countries have varying levels of development. This is also proving to be a hindrance in terms of developing effective infrastructure across international borders such as rail, roads and airports.

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Saturday, January 3, 2009

Changes in Customs duty, Additional Customs duty rates and drawback

As part of the stimulus package announced here today, the following changes in Customs and Additional Customs duty rates, and drawback have been carried out:-

Customs and Additional Customs duty changes

On imported cement, Additional Customs duty and the special additional duty of customs [@4%] was fully exempted w.e.f 3.4.2007. This exemption has now been withdrawn. Consequently, imported cement will attract countervailing duty equal to applicable excise duty, and also special additional duty of customs @ 4%.

On zinc, customs duty was fully exempted w.e.f 29.4.2008. This exemption has been withdrawn, and the customs duty rate has been restored to the earlier rate of 5%.

On ferro-alloys, customs duty was fully exempted w.e.f 29.4.2008. Subsequently w.e.f 31.10.2008, customs duty on certain ferro-alloys, namely, ferro-molybdenum and ferro-vanadium was restored to the earlier rate of 5%. Now, the exemption provided on all other ferro-alloys has also been withdrawn, and the customs duty rate on all ferro-alloys has been restored to 5%.

On TMT (thermo-mechanically treated) bars and structurals, Additional Customs duty was fully exempted w.e.f 29.4.2008. This exemption has been withdrawn. Consequently, imported TMT bars and structurals will attract Additional Customs duty of 10%.

These changes are intended to provide a level playing field to the domestic industry. Notification No. 2/2009-Customs dated 2.1.2009 has been issued to implement these changes with immediate effect, was issued today.

Drawback changes

The drawback schedule for the financial year 2008-09 was notified with effect from 1st September, 2008. Thereafter, the Government has received several representations from exporters seeking revision in these rates, which have been examined by the Drawback Committee headed by Dr. Saumitra Chaudhury, Member, Economic Advisory Council to P.M. Based on these recommendations, the following changes are being carried out in the drawback schedule:

The drawback rates have been enhanced in respect of the following items:

a. On cotton knitted fabrics, from 4.5% to 5%;

b. On man-made knitted fabrics, from 8.7% to 8.9%;

c. On woollen knitted fabrics, from 5.7% to 5.8%; and

d. On agricultural/horticultural/forestry hand tools, from 8.5% to 10% (with a cap of Rs.7.5 per kg).

The Value cap has been enhanced in respect of the following items:

a. Cotton yarn, grey from Rs.8.00 per kg. to Rs.12.00 per kg.;

b. Complete bicycles from Rs.203 per piece to Rs. 240 per piece; and

c. Stainless steel cutlery and knives from Rs.23.50 per kg. and Rs.19.80 per kg. respectively to Rs.28.00 per kg.

In the case of texturised/twisted yarn of Polyester manufactured from partially oriented yarn (POY), on which terminal excise duty has been paid, the drawback rates are being revised to include the central excise portion.

All the above changes in drawback are being implemented with effect from 1st September, 2008. Drawback will henceforth be also allowed on boots/half boots/shoes of leather cum synthetic/textile materials at 10.5% subject to a value cap of Rs.110 per pair. The details of these changes are contained in the relevant Notifications being issued today.

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