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Chinese imports of umbrellas and musical instruments are hurting MSMEs; GTRI
Industry News- Sep 02,24
The report details that China supplies 95.8% of India’s umbrellas and sun umbrellas, 91.9% of artificial flowers and human hair products, 59.7% of glassware, 54.3% of leather goods, and 52.5% of toys.
Increasing imports of items such as umbrellas, toys, fabrics, and musical instruments from China are significantly impacting Indian Micro, Small, and Medium Enterprises (MSMEs), according to a report by the Global Trade Research Initiative (GTRI). The report highlights that from January to June 2024, India's exports totalled $8.5 billion, while imports from China soared to $50.4 billion, resulting in a substantial trade deficit of $41.9 billion.
China now accounts for 29.8% of India's industrial goods imports, making it the largest contributor to India's trade deficit. Ajay Srivastava, Founder, GTRI, emphasised the urgent need for India to invest in deep manufacturing to reduce dependence on Chinese imports, which are undermining domestic MSMEs. He noted that the influx of cheaper Chinese goods is making it difficult for local businesses to compete, leading to operational shutdowns and stunted growth.
The report details that China supplies 95.8% of India’s umbrellas and sun umbrellas, 91.9% of artificial flowers and human hair products, 59.7% of glassware, 54.3% of leather goods, and 52.5% of toys. Even sectors where Indian artisans once thrived, such as ceramics (51.4%) and musical instruments (51.2%), are now dominated by Chinese imports.
Indian MSMEs are also losing ground in industries like furniture, bedding, lamps, cutlery, stone articles, and carpets. These traditionally strong sectors are now threatened by the growing presence of Chinese products, diminishing the competitiveness of local producers.
Srivastava stressed that India's heavy reliance on Chinese imports is eroding the market share of its MSMEs and weakening the country's economic independence. Strengthening domestic manufacturing is essential to protect these small businesses and maintain India's economic sovereignty.
(ET)
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