Cheaper goods from Chinese e-tailers like Aliexpress, Club Factory, Shien may become a thing of past

6pack

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Source: EconomicTimes

Cheaper online goods from Chinese e-tailers like Club Factory, Shien and Aliexpress may become a thing of past as government is considering to impose restrictions on online purchases of goods from Chinese ecommerce platforms and apps to reduce the adverse impact on local manufacturing and violation of domestic laws. Department of Industrial Policy and Promotion has also suggested capping purchases of products from Chinese e-retailers and apps at four per buyer per year.

A large number of products from China are entering India under the guise of ‘gifts’ and shipped directly to customers. The government exempts 'gifts' of up to Rs 5,000 received from abroad. The rule was there to allow Non-resident Indians (NRIs) to send gifts of low value to families back home free of customs duty.

There has been allegations that sellers on Chinese e-commerce companies like Aliexpress, Club Factory and Shien have been sending goods marked as 'gifts' into India to avoid import duty.

Apart from import crackdown, government is also planning to create export hub with the help of India Post, which collects duty on imported goods.

According to a ToI report, India Post may set up 20 export hubs to give a boost to local sellers in cross border trade. Chinese e-commerce sites have become popular in India as they are able to keep the prices very low because the goods are dispatched through China Post and more often than not marked as 'gifts' to evade customs duty. The Chinese e-commerce sites are becoming gaining popularity in India as according to some reports the products are at least 50-60% cheaper than what's available on Indian e-commerce sites

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seshu

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not sure about other Indians / Indian shareholders

IMO
basically it is Ambanis & Paytm who can easily get the goods
from other countries , re-brand them and sell at higher prices

may be Patanjali also joins with inferior quality of products ...
 

dpandey

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not sure about other Indians / Indian shareholders

IMO
basically it is Ambanis & Paytm who can easily get the goods
from other countries , re-brand them and sell at higher prices

may be Patanjali also joins with inferior quality of products ...
Forcing foreign companies to parnter with a local firm is a pretty standard policy used by many countries. Actually it is something that China does all the time. This policy is successful if the local company has the ability to learn/steal from its partner. Doesn't work well if it is only a financial arrangement (E.g. Essar/Hutch. The Ruia's did nothing and still made a killing).

https://money.cnn.com/2018/04/05/news/economy/china-foreign-companies-restrictions/index.html

TL;DR
"International companies have long complained that China has strong-armed them into handing over trade secrets in exchange for market access. In some sectors, Beijing will only let foreign firms operate through joint ventures in which Chinese partners have the majority stake."
 

dpandey

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Ambani - reliance shirts made in Bangladesh
I dislike Ambanis as much as the next guy, but it probably isn't as black and white as you want it to be. It is very important for Indian big businesses to spread their foot print and establish a strangle hold at least in South Asia.

You need to remember that foreign subsidiaries are not just commercial entities. They are important vehicle to move spies and military assets around (all american companies will have CIA assets on their payroll). Bangladesh has a sizable Hindu population and it is important for India to keep a tab on what is going on inside.

Of course, I am assuming that RAW is smart enough to use these companies to its advantage.
 
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6pack

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Your red highlighted bit explains why i must give ID for imported items. They want to track how many times i buy from where and whom
That ID rule was in effect from years back on Amazon, eBay, citibank or other sites like iccworld etc which came up in between. I think its for tracking co-relation between CC spending and paying taxes. IT saw that people who did not pay much tax were spending a lot of money on cc bills buying stuff from abroad and that rule came in to effect. Or maybe they wanted to track something else.

That red highlighted thing is just proposed and not yet made into a rule or law.
 

6pack

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https://economictimes.indiatimes.com/news/economy/foreign-trade/govt-considering-steps-to-prevent-misuse-of-gift-route-to-import-goods/articleshow/67365768.cms

Imported ‘gifts’ may be capped at Rs 5,000 per Aadhaar number to keep tabs on Chinese etailer

The government is considering sample checking of consignments and limiting the value of imported ‘gifts’ to Rs 5,000 per Aadhaar number to keep a check on online purchases of goods through foreign ecommerce platforms and applications, especially China.

This comes in the wake of a large number of online purchases from China entering India as gifts and being shipped directly to customers. Under the current customs rules, gifts of up to Rs 5,000 intended for personal use are exempt from customs duties.

A standing group of secretaries chaired by industry secretary Ramesh Abhishek had suggested that the revenue department examine “steps to prevent violation of existing rules to circumvent customs duties particularly by the gifting route” at its first meeting in September 2018.
 

nRiTeCh

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Well that's what exactly is happening since ages and very common now. If you happen to bump into retail markets one can see that shirts, tops, shorts, undergarments, plastic stuff, imitation jewellery, even ribbons, bows, watches etc etc. everything is from China and these shops sell us at exorbitant rates with zero bargain in which we can easily buy 4-5 quantities of same item on AE.
Funny thing is at times they forget to remove those chinese seller tags which can be easily be traced on AE or Alibaba.