Smuggled Chinese hosiery eat into India’s profits

India hosiery industry players are unhappy because

cheap Chinese products arriving through illegal channels are affecting domestic sales and profit margins. According to Ludhiana-based manufacturers, smuggled Chinese garments cost less, since their suppliers avoid paying customs or excise duty. As Sudershan Jain, President, Knitwear and Apparel Manufacturers Association of Ludhiana explains, "As per our estimates, Chinese garments control 60 per cent of local retail market. Now the players have decided to ask local MP to take up the issue with the central government.

First, the Indian industry was affected by duty free imports from Bangladesh and now the illegal inflow of Chinese products. Both these are badly affecting Ludhiana’s knitwear industry, which manufactures around 90 per cent of the woollens in the country. It is estimated that the Ludhiana hosiery industry has an annual turnover of Rs 8,000 crores and Rs 1,500 crores of those are generated through exports.

The export industry is already hit due to a slowdown in the US and Europe, now China is finding ways to deal with the situation by dumping goods in India at throwaway prices. Smugglers are taking advantage of the porous Indo-Nepal border to get their products to India. Apart from the knitwear industry, sewing machine industry is also taking a beating from sewing machines manufactured by Japanese companies in China, which have a superior quality.