Domestic electrical equipment industry has been facing serious challenges due to increasing imports of electrical equipment, which captured almost 40% of the domestic market.
China’s share in Indian imports has dramatically increased in the last few years – from 15.3% of the total in 2005-06 to 45% in 2012-13. Imports from China grew at a CAGR of 45.5% during the last seven years.
India’s imports duties on most of the electrical equipment are already low (BCD 7.5%), which was further aggravated by signing of Free Trade Agreements by India with various countries, under which the import duties were further lowered or made nil. There has been serious underutilisation of installed capacities across several products. Also, non-tariff and technical barriers imposed by various countries hinder India’s exports of electrical equipment. All these significantly impacted commercial viability of the domestic industry.
With this scenario, IEEMA Executive Council constituted the Public Policy Cell, in December 2012, under the Chairmanship of Mr. Narayan Sethuramon, Managing Director and CEO, WS Industries (India) Ltd. and Co-Chairmanship of Mrs. Indra P Menon, Executive Director and President, Lakshmanan Isola Pvt. Ltd. The Chairmen and the Vice Chairmen of all Product Divisions of IEEMA are members of this Cell, besides other nominated members who have been contributing towards this endeavour.
Besides creating a knowledge base on product-wise imports and exports of electrical equipment, the Cell deliberated and addressed issues related with surge in imports and non-tariff/technical barriers creating exports bottlenecks for the industry. It also examined and represented on impact of signed Free Trade Agreements, proposed concessional duties on products to be covered under future Trade Agreements, Rules of Origin and other collective issues of importance, like non-closure of T&D projects commissioned by EPC contractors, standard terms & conditions for turnkey T&D and sub-station contracts, abuse of duty benefits under chapter 01, etc. The Cell also played an advisory role for Product Divisions of IEEMA and suggested suitable remedial measures for safeguarding their interests.