Govt Plans To Raise Import Duty On Non-Essential Items, Says Report; Check Details

The Centre plans to regulate the imports of “non-essential items” by raising the duties on inbound shipments, according to an Indian Express report. It comes amid growing concerns around a slowdown in exports and a widening trade deficit.

It added that ministries in the central government are in the process of carrying out an exercise to select a list of items on a granular basis. “We are looking at non-essential imports for which there is enough manufacturing capacity. It is to identify non-essential items, where there is sufficient production capacity and allow for higher import substitution,” the IE report said quoting a senior government official.

The list of commodities that will see rate hike, which will be prepared, will reportedly be restricted to only the commodities that have “enough manufacturing capacity” in the country.

The government is also looking for ways to separate commodities that come under the same Harmonised System of Nomenclature (HSN) code for imposing duties. An HSN code subsumes a broad sweep of items. All the items under one HSN code are, however, taxed at the same rate. But under the current deliberations, the Centre is likely to impose duty only on a few items under a code and not all.

India’s exports recorded a flat growth of 0.59 per cent to $31.99 billion in November, even as trade deficit widened to $23.89 billion during the month, according to the data released by the government on Thursday.

Exports stood at $31.8 billion in November last year. Imports rose by 5.37 per cent to $55.88 billion in November as compared to $53.03 billion in the corresponding month a year ago, the data showed.

During April-November 2022, exports rose by 11 per cent to $295.26 billion as against $265.77 billion in the same month last year. Imports however rose by 29.5 per cent to $493.61 billion during the eight months period of this fiscal. It was $381.17 billion during April-November 2021, as per the data.

The merchandise trade deficit for April-November 2022 has increased to $198.35 billion as against $115.39 billion in April-November 2021.

India’s exports entered negative territory after a gap of about two years, declining sharply by 16.65 per cent to $29.78 billion in October, mainly due to global demand slowdown, even as trade deficit widened to $26.91 billion.

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