The government is considering hiking customs duty on a number of products, mainly imported from China, amid ongoing border tensions with the neighbouring country, a source said.
Although nothing has been finalised as yet, the focus would be on cutting down import of non-essential items, the source said.
The discussion was on hiking duties on goods imported mainly from China, the source said.
About 14 per cent of India's total imports are from China. Between April 2019-February 2020, India has imported goods worth $62.4 billion, while exports to the neighbouring country stood at $ 15.5 billion.
The main goods imported from China include clocks and watches, musical instruments, toys, sports goods, furniture, mattresses, plastics, electrical machinery, electronic equipments, chemicals, iron and steel items, fertiliser, mineral fuel and metals.
India has time and again raised concerns over the widening trade deficit with China, which stood at about $47 billion during April-February 2019-20.
The move to raise duties also assumes significance as the government is working on ways to boost local manufacturing and promote Make in India. The other steps include attracting global companies that are seeking to set up alternate global supply chains outside China.
Policymakers are also looking at non-tariff barriers being imposed by India's trading partners such as China.
The government recently put import restrictions on tyres, while also making its prior approval mandatory for foreign investments from countries that share land border with India to curb "opportunistic takeovers" of domestic firms, following the COVID-19 pandemic, a move which will restrict FDI from China.
One of the major steps on which the government is working is to restrict low quality Chinese imports, and for that technical regulations, which includes safety and quality standards for about 370 products are being formulated with a view to cut imports of these non-essential items from countries like China, sources added.
These items include chemicals, steel, consumer electronics, heavy machinery, telecom goods, paper, rubber articles, glass, industrial machinery, metal articles, furniture, pharma, fertiliser, food and textiles.
The commerce ministry has also identified 12 sectors—food processing, organic farming, iron, aluminium and copper, agro chemicals, electronics, industrial machinery, furniture, leather and shoes, auto parts, textiles, and coveralls, masks, sanitisers and ventilators—in which to make India a global supplier and cut import bill.
To cut import dependency on China for APIs (Active Pharmaceutical Ingredients), the government in March approved a package comprising four schemes with a total outlay of Rs 13,760 crore to boost domestic production of bulk drugs and medical devices in the country along with their exports.
It also set up a high level empowered group of secretaries, to be chaired by the cabinet secretary, and a Project Development Cell (PDC) in ministries/ departments with a view to attract investments to the country.
