FIEO President for Continuation of Open Imports of Capital Goods Inspite of Domestic Loss Pressure

[FIEO Press Release dated 9^th August 2012]

Mr. M. Rafeeque Ahmed, President, Federation of Indian Export Organisations (FIEO) while commenting the IIP data released on 9 August said that IIP had shrunk further to 1.8% and a progressive decline was observed from 6.20% a year ago to 4.10% a quarter ago and 2.40% in the month of May, 2012. Given the scenario, there are apprehensions of GDP falling to levels of 5.3%.

FIEO Chief stated that while on the whole In terms of industries, 14 of the 22 industry groups in the manufacturing sector have shown growth during June, manufacturing has fallen by 3.2% and manufacturing of capital goods has contracted by an alarming 27.9%. This has prompted domestic manufacturers to request the Government to impose restrictions on import of used capital goods and even stop benefits available under EPCG scheme for importing used capital goods. Capital goods imports are estimated to have crossed $ 40 billion at present.  They were $6.5 billion in 2003-2004.

President, FIEO stated that any restriction on imports under EPCG scheme may adversely hit the textile and machine tool sector which import the same in large numbers and are already hit by the global recession. He stated that adequate anti-dumping duty and safeguard duty mechanisms are in place to counter any adverse impact of mass import to the domestic sector.