GANDHINAGAR, INDIA — India's plastics industry is asking the government to raise import duties on a range of plastic products, arguing that it needs protection from manufactured goods from Southeast Asia and China, in particular.
The All India Plastics Manufacturers Association disclosed at a news conference at the recent Plastindia trade fair that they want the government to boost import duties on finished plastic products, typically consumer and household goods, from 10 percent to 15 percent.
It's not the only internationally related policy proposal AIPMA is making — the trade group wants the government to remove anti-dumping duties on imported machinery, including current high duties on injection molding machines from China.
It argues that the machinery duties hurt India's processing sector by raising costs.
A top official with AIPMA, which is based in Mumbai, said the group hopes its proposals will be supported by the new government of Prime Minister Narendra Modi because he's launched a high profile “Make in India” campaign to support Indian manufacturing.
One of the key parts of AIPMA's proposal for Modi's upcoming budget, his first major budget since taking office last year, is for the higher tariffs on plastic products.
“A lot of imported finished goods have come in, say from Southeast Asian countries or China,” said Arvind Mehta, chairman of AIPMA's governing council, in an interview at the Plastindia trade fair, held Feb. 5-10 in Gandhinagar.
China is the “major” concern but the industry also is seeing a lot of imports from Thailand, Indonesia and Malaysia, he said.
While AIPMA did not provide a lot of details on its proposal, in a summary of its budget priorities presented to the government, it said it wanted “import duties raised to 15 percent on finished plastic products, which is very much essential for protecting the Indian SMEs.”
He said part of the problem is that the Indian industry's small scale, including many companies with fewer than 50 employees, makes it less competitive globally.
While the industry is doing some consolidation, Mehta said it wants more government help because it believes the growth of imports hurts the domestic processing industry. AIPMA's 2,500 members include a sizable segment from the processing sector.
On the machinery tariffs, however, AIPMA takes the opposite position, arguing against the Indian government's anti-dumping duties on Chinese-made molding machines.
“The anti-dumping duty on the injection molding machines should not be levied as Indian SMEs should have access to economically priced technology,” AIPMA said in the summary of its government proposals.
Mehta said the Indian processing industry's growth could be hurt because the country's domestic molding machinery industry is too small and may not be able to supply equipment fast enough.
India's plastics machinery industry, however, said last year it wanted to expand the anti-dumping duty on molding machines from China to Taiwan, the Philippines and Malaysia. The duties on Chinese machines have been in place since 2009.
The New Delhi-based Plastics Machinery Manufacturers Association of India argues that the imported machinery is dumped in India at unfair prices, and that hurts the domestic machinery industry.