The India-China stand-off continues to hurt the Indian industry - whether chemicals, pharma, or auto. In fact, several industries have made representations to the government including auto industry body Society for Indian Automobile Manufacturers (SIAM), which has urged the government to clear import congestion at ports at the earliest.
Rajan Wadhera, President of SIAM shared his views and outlook on the situation with CNBC-TV18.
“There is no reduction yet in terms of the severity in the 100 percent inspection that is being carried out on all consignments. While we have been in discussion with the various government agencies, we do expect some kind of relief on the consignments that are coming for original equipment manufacturers (OEMs), especially for the manufacturing of the vehicles,” he said.
“I believe there are other compulsions for which the customs officials are inspecting every consignment and there are various reasons of security and also in the public domain there is a discussion about some narcotics angles hence extra inspections are being carried out on all the consignments,” he added.
The auto sector has stated that it cannot bear more than 10-15 days of delay in consignments.
When asked about the percentage of the total auto industry turnover that comes from imports from China, he replied, “Some members are importing up to 7-8 percent and some are as low as 1 percent of their total buying. Buying from China has gone up largely due to BS-VI emissions introduction. The BS-VI that were required to introduce in a matter of three years required certain supply chain and technology and quality capabilities and the scale and most of the OEMs went to China because, in China, the global OEMs have their joint ventures (JVs) where they have the technical capability, they have the scale. So most of the parts which are imported today, quite a large number are coming for the BS-VI technology that got implemented.”
In terms of delay in Chinese imports, he further mentioned, “The issue is that for some time, there will be a complete halt of production because even if we don’t get one part, you cannot produce. If the parts don’t come in, we have to stop production, it is not a question of slowing down production.”