The government has imposed limits on import of power tillers and components with an aim to target China and discourage inbound shipments of these products. "Import policy of power tillers and its components is amended from free to restricted," the Directorate General of Foreign Trade (DGFT) has said in a notification on Thursday. Following this move, the importer would have to seek a license from the directorate for the imports of power tillers and components including engine, transmission, chassis and rotavator.
DGFT, in its public notice, has laid out a procedure for giving import licenses. According to new rules, the cumulative value of authorisation issued to any firm or all firms in a year would not be exceeding 10 per cent of the value of power tillers imported during FY20 by that company.
Chinese power tillers and components are much cheaper than Indian-made ones. It puts local companies at a disadvantage when compared with China's.
The cap of 10 per cent would also be applicable for components of power tillers. The applicant should have been in the business for at least three years and should have sold a minimum of 100 power tillers in the past 3 years, it said. "Only manufacturers are eligible for applying for an import authorisation for import of power tillers or its components. The applicant should have satisfactory and proven infrastructure for training, post sales service and spare parts," it added.
India has taken a slew of retaliatory measures in the past few weeks as a part of its economic offensive against China amid the ongoing border tensions between the two Asian neighbours.
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