Daily Management Review

New Import Hurdles In India Hit Chinese Firms: Reports


With the deterioration in the business environment between India and China following the clash on Himalayan border between the Indian and Chinese army, reports are now emerging of delays in clearance and approvals from India’s quality control agency for their goods is being faced by Chinese companies such as Xiaomi.
Following the border tussle, there was a huge chorus call in India of boycotting of Chinese products by Indian nationalist groups as well as a large section of Indian consumers and since then there has apparently been greater scrutiny of Chinese imports.
20 Indian soldiers were killed in the border clash in June.
Approvals for mobile phone components and televisions have recently been delayed by the Bureau of Indian Standards (BIS) which has reportedly hit the plans of companies such as Xiaomi as well as Oppo, claimed the reports.
There was no comment available on the issue from the BIS and the China’s commerce ministry and the foreign ministry.
There were also no comments available in the reports from Xiaomi and Oppo.
The economic ties of the two Asian giants have already been hurt by the most serious border tension in decades and the impact could be greater in the coming days according toreports quoting Indian officials.
“The relationship has gone south dramatically,” said one report quoting an official. The report added that it is also unlikely that several investments proposals from Chinese companies would be granted approval by the Indian authorities.
“We cannot do business as usual”, one of the officials were quoted as saying.
Mandatory screening and reviewing of investment flows from China was announced by the Indian government in April. It has been alleged that the pace of reviewing and approval of investment proposals from China, if any, has been slow since the clash.
A new set of standards policy that is likely to be announced by the end of August, is being worked upon by the Indian government and the aim of it is to prevent import of low-quality products from China and elsewhere, said report quoting a senior Indian official.
Reports however claimed that even branded Chinese companies’ hoping to step up sales have been denied approvals because of those deliberations.
“The products are not getting clearance as quality standards are being upgraded because of which many product lines could be affected,” said another report quoting an Indian official.
Eight of every 10 smartphones sold in India belongs to Chinese smartphone brands, including Oppo and Xiaomi. The companies import several components from, China even though the two companies assemble most of their models in India.
Urging industry to focus on boosting domestic production, a call for creating a “self-reliant India” was recently given by the Indian Prime Minister Narendra Modi.
Some specific electronic goods – whether imported or made locally, have to through some standards set by the BIS according to the authority’s registration scheme. BIS approves the applications after companies get their products tested in a certified laboratory.