India-China border row pinches India Inc hard, imports held up

In the wake of the India-China border clashes and the subsequent hardening of positions on both sides, the worst apprehensions of Indian trade and industry seem to be coming true, market sources said.

For over a week now, hundreds of thousands of cargo containers carrying all kinds of import materials from China-Hong Kong, are now grounded at various sea and air ports in the country.

These include around 1,000 containers containing critical spares, components and finished units of agriculture sprayers worth over Rs 300 crore, and other ready goods or spares of practically the A-to-Z of Indian industries, triggering alarms in India Inc.

One of the unofficial reasons cited is complete examination of all containers originating from China, opening each unit down to the individual packing or box to check the contents, ostensibly on grounds of national security besides stringent scrutiny of all documents, etc.

"In Jawaharlal Nehru Port Trust (Mumbai), around 200 containers of urgently required agro-sprayers and spares are stuck. Farmers all over India need them badly as the sowing season has started. If they don't get it by early-July, their crop season may be ruined and we shall lose our full investments," prominent agro-sector manufacturer-cum-importer Tushar C Padgilwar said.

Padgilwar, the President of the Agri Sprayers TIM Association (India) (ASTIMA), rued that besides the cargo that has already arrived, huge consignments are currently sailing to India from China and would be hit similarly.

A leading import-export consultant from Thane said that containers originating from China-Hong Kong, with all kinds of products - across industrial sectors, perishables and critical goods - worth several billions of dollars, are currently stuck at ports all over India, with no clarity from the authorities on when these would be released.

"Certain types of cargo can wait, but most other kinds of goods, especially perishables and pharmaceuticals, cannot be delayed... Moreover, the importers have made full payments for the consignments, cleared customs duties and even taken advance orders from their customers. Any unnecessary hold-up creates huge complications for all stakeholders," said the consultant, preferring anonymity.

Though the Customs Department and other officials concerned remain tight-lipped, at the JNPT, notices are put up proclaiming: 'China Origin Consignment – Should Not Allow Delivery'.

Institute of Chartered Accountants of Indias (ICAI) Western Region Council's ex- Secretary, Aniruddh Shenwai, stressed the "need for a pragmatic approach since any abrupt economic move can be disastrous" in the long run.

"India depends hugely on China for various spares, raw or finished products. Hence, such acts may be catastrophic with a cascading effect on the entire Indian economy until viable, alternate sources with assured supplies are made available to us," Shenwai said.

Padgilwar, meanwhile, said: "We have no objections to the 'complete examination' and 'documents scrutiny' which has begun at a couple of ports, but the process must be expedited. It is affecting the entire business cycle with future ramifications.

Normally, containers are unloaded and cleared within 48-72 hours, but since the past one week, China-Hong Kong originated cargo containers are routinely held up after the recent border issues in Galwan Valley, pointed out Mumbai trader RK Jain.

Industry sources said that of all the container traffic in India, more than two-thirds originates from China-Hong Kong, and the current border impasse has already started impacting Indian business.

On its part, ASTIMA has shot off several representations to the JNPT and the Union Government on the issue, but there is no response, as more than 100 ASTIMA members virtually jump at the slightest flutter on the India-China borders.

Though Chennai Port has started clearing certain select items after thorough scrutiny of the cargo and its documents, things are not moving in Mumbai or Kolkata, or other major ports, said Padgilwar.