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COVER
STORY: CHINESE GOODS
Taste
of China
The surge
of consumer goods import from east Asia has consumers delighted, the industry
in a panic and the Government confused
By V.
Shankar Aiyar and Rohit Saran
It's
past 2 p.m. at Mumbai's Musafirkhana and the market is buzzing with activity
as usual. Suddenly a song from one of the shops breaks the monotony. It's
Kavita Krishnamurthy singing "Nimbuda, nimbuda, nimbuda..."
from the Bollywood hit Hum Dil De Chuke Sanam. Shoppers stop and gape
trying to locate the source of the music, hoping in their hearts to catch
a glimpse of the tall and lissome Aishwarya Rai even if only on TV. But
no, the music is not emanating from the 14-inch TV sets or the stereo
systems on sale. The temptress is a 10-inch, battery-operated doll. Made
in China. Price: Rs 150.
 Battery
cells for Rs 2, feature-packed phone sets for Rs 500, cigarette lighters
starting from Rs 5, car stereo with detachable front panel for Rs 2,200,
a 22-function Swiss knife for Rs 75, a portable stereo player with a pair
of speakers for Rs 230, ceiling fans with inbuilt inverters, musical toys
for a song ...
This is
not a product list of a retail store going out of business. These are
also not products on an annual clearance sale. It's just a small sample
from the surging waves of imported consumer products hitting the Indian
shores, mainly from China. And yes, we are not talking of smuggled goods.
Most of the products are imported legally and the prices are inclusive
of customs duty.
For consumers,
it's a welcome taste of China. Manufacturers though are calling it the
second Chinese invasion-only the battleground has shifted from the snow-clad
NEFA border where China had struck in 1962 to the Indian marketplace.
The Government is in a bind: who should it protect-the consumer or the
manufacturer? Are imports a threat to domestic industry? And if they are,
can and should they be halted? The sheer song and dance about the issue,
the number of newspaper and magazine columns being devoted to the topic
and the intensity with which it is being discussed in Parliament would
suggest that it is a matter of national emergency.
Contrary
to popular perception not all the goodies are coming from China. While
the country does dominate the import market for appliances, locks, fabrics
and toys, articles are flowing in from virtually every south-east Asian
country. Food items, soaps and computer parts from Thailand, chocolates
and glues from Malaysia, instant-coffee mix and nutritional drinks from
Singapore, glassware and crockery from Indonesia, tea, juices and crockery
from Sri Lanka, computer peripherals, sanitary fittings and tiles from
Taiwan and textiles and locks from Korea have swamped the Indian market.
Claims about
the volume of imports are flying thick and fast. K.A. Khan, secretary,
Association of Indian Dry Cell Manufacturers, claims that eight million
AA size cells (pen-torch cells) are being imported from China every month
now. Last year's figure was a million cells a month. Incidentally, dry
cells are one of the three imported products against which the Union Commerce
Ministry has initiated anti-dumping investigations. The other two are
toys and sports shoes. But no estimates of the magnitude of imports are
available, either with industry chambers or with the Government. Investigations
by INDIA TODAY in Mumbai, Delhi and Chennai found traders and wholesalers
more forthcoming about estimates. Shaukat Ali S. Manekia, president of
the Mumbai-based Glassware Merchants Association, says that imported glassware
and crockery brands now command about 45 per cent of the market in India-up
from just 15 per cent last year.
Ameya Trading,
which imports food products, is selling imported branded food like fruit
juice, instant coffee and biscuits in four states-Delhi, Maharashtra,
Andhra Pradesh and Gujarat. Says Ajay Mantri, managing director: "It's
a misconception that these products are brought for the rich. They are
of high quality, innovative, affordable and are for the masses."
Dinesh Jain, a wholesaler at Bhagirath Palace, the hub of the electrical
trade in Delhi, avers that the entire market for festival lightings in
metros has been captured by Chinese products.
Then there
are big Indian brands sourcing products from east Asia. Siyaram Poddar
Group, owner of the Oxemberg label, is procuring more than 50,000 m of
polycotton and cottonpoly fabric from Thailand, Indonesia and China. "It's
not just the cost, imported fabric is of better quality and has minimum
defects. This enables us to go in for blind cutting and thus improve productivity,"
claims Arvind Poddar, executive director of the group. Companies like
Kumarmangalam Birla's Madura have gone a step further. It sources fabric
from east Asia, ships it directly to Bangladesh, makes garments and exports
them to India. Last year, Bajaj Electricals tied up with the GD Midea
Holding Co Ltd, based in the Chinese province of Guangdong to produce
table and pedestal fans. Branded as BajajMidea, these fans (priced at
Rs 1,695) have been selling well in India.
Pg.
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Enron
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M/s Rao & Manmohan, says INDIA TODAY Associate Editor
