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Manual inspection of imports from China leading to delays: Auto parts association, SIAM

China made up 27 percent or $4.75 billion out of the total $17.6 billion imports done by India

June 29, 2020 / 06:13 PM IST

Imports of auto components from China are being subjected to one-hundred percent manual inspection resulting in inordinate delays in clearance, a lobby body of the parts and vehicle associations said.

Several auto component and vehicle manufacturing companies have complained of ‘very high’ congestion at the Mumbai port after their shipments that sailed from China got stuck.

Sources said the Automotive Components Manufacturers Association (ACMA) has received multiple concerns from its members regarding the blockade.

Explaining the complexity of the automotive value chain and the need for permitting clearance of imports, Deepak Jain, President ACMA, said: “Some of the items imported from China are critical components such as parts of engines and electronics items for which we are yet to develop domestic competence. The automotive value chain is a highly complex, integrated and interdependent one; non availability of even a single component can, in fact, lead to stoppage of the vehicle manufacturing lines."

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The Society of Indian Automobile Manufacturers (SIAM) said that import consignments being subject to manual inspection is resulting in inordinate delays in clearance at the ports.

“Inordinate delays in clearance due to congestions at port could eventually impact manufacturing of vehicles in India. The industry is piecing itself together as growth is limping back; any further disruption at this juncture is best avoided" said Rajan Wadhera, president, SIAM.

While majority of the vehicle manufacturing companies do not directly import components (given their high degree of localisation) their parts manufacturing partners are engaged in importing components. These parts sometimes have to be modified to suit requirements of the vehicle makers.

"Post-lockdown, production in the component industry is gradually picking up in tandem with growth in vehicles sales, it is therefore in the best interest of the industry and the economy that any further disruptions are best avoided," Jain added.

India is a large importer of components from China. In 2018-19 imports from China made up 27 percent or $4.75 billion out of the total $17.6 billion imports done by India, according to the Automotive Component Manufacturers Association (ACMA), the apex body of auto parts manufacturers.

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Moneycontrol News
first published: Jun 29, 2020 04:33 pm