Highlights

Government of India formally announced that the completely bans the import of refrigerants and air-conditioners and non-essential imports. This has been done for reduce the dependent on China and tighten local manufacturing. GoI says that an importer cannot fill in the refrigerant outside India. Thus, he will have to create assembly units using the local work force. This will increase employment nationwide.

In July 2020, the Directorate General of Foreign Trade (DGFT) put television sets in the restricted list. This made it mandatory for the importers to seek permission from the DGFT to import television related goods.

Government of India had already imposed import ban on TV sets, tyres and Agarbattis to boost their domestic market.

Backdrop

In last financial year 2019-20, India imported $469 million worth air-conditioners from China and Thailand. The Chinese imports accounted to $241 million and those from Thailand were around $189 million. The window air-conditioner imports were around $35 million.

After Indian-China Ladakh stand off, India has been reducing its reliance, on People’s Republic of China especially in terms of trade.

Impacts

Chinese ban will induce assembly of air-conditioner within India in phase I. In phase II, their manufacturing will happen nationwide. This change over is expected from 30 per cent of imports. Thus, employment in india will increase and will boost the economic growth.

What is restricted list of imports?

The tariff & non-tariff barriers imposed on imported goods is known as the restricted list of imports. This is done to control the volume of goods entering in India. These restrictions are adopted to maintain the exchange rate of the currency.

Negative List of Imports

The Negative List of Imports consists of the following

  • Freely Imported Items
  • Prohibited List
  • Restricted List

The freely imported items are those that carry duty free import under Duty Exemption Scheme. Majority of the capital goods fall into this category. The prohibited list are those that are completely banned. The restricted list consists of those goods that are imported only with license

India bans import of refrigerators Air Conditioners India bans import of refrigerators Air Conditioners