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Response will be speedily announced to offset coronavirus impact on industry: Nirmala Sitharaman

Finance Minister Nirmala Sitharaman on Tuesday called for a secretary-level meeting to assess the various issues the outbreak poses to the Indian industry, known to be heavily dependent on the neighbouring country in several sectors.

By: ENS Economic Bureau | New Delhi | Updated: February 19, 2020 3:59:26 am
nirmala sitharaman on coronavirus outbreak, coronavirus impact on indian business, corornvirus impact indian industries, nirmala sitharaman indian trade coronavirus impact meeting, business news, indian express Finance Minister Nirmala Sitharaman, with Finance Secretary Rajiv Kumar (left) and Revenue Secretary Ajay Bhushan Pandey in New Delhi on Tuesday. Prem (Express photo by Nath Pandey)

With the novel coronavirus (covid-19) still hitting China’s operations across various sectors, the government has decided to “speedily” formulate measures to minimise the potential impact of the outbreak on its industry. Finance Minister Nirmala Sitharaman on Tuesday called for a secretary-level meeting to assess the various issues the outbreak poses to the Indian industry, known to be heavily dependent on the neighbouring country in several sectors.

The outcomes from the discussions will be taken up in a meeting between the FM and secretaries of the Finance Ministry on Wednesday afternoon, so that “possible solutions” can be zeroed in on. Post this, the minister hopes to have a discussion with the Prime Minister’s Office, so that “speedily some response will be announced at the earliest,” she said. Sectors like pharmaceutical, chemicals (like those for paints and tyre manufacturing) and solar equipment were “very vocal” about disruptions in their supply chain, according to Sitharaman.

“Today, when their raw materials have to come, there is a delay, or the products come, but the papers don’t come. So the disruption is felt increasingly by these three,” she said. The minister had added that there were some essential raw materials for medicines for which the government would “have to act speedily”. The minister dismissed claims that prices of raw materials had been rising as a result of the outbreak. “There wasn’t a worry about price rise from anybody as yet,” said Sitharaman.

The discussions on Tuesday centered around issues like requests for a “self declaration” system at Customs for various manufacturers to be able to receive the stocks of raw material that have arrived at the ports, but were stuck due to lack of the necessary paperwork from China.

Another issue raised was whether other countries can be explored as alternatives for sourcing raw materials, she said.

Some micro, small and medium enterprises had sought flexibility from banks, citing delayed and staggered raw material supply that had been impacting their ability to manufacture and send out their products, she said.

The current situation made a “strong case” for removing higher customs duties on certain products primarily sourced from China that may now need to be sourced from other countries, said an analysis paper by the Confederation of Indian Industry.

China accounts for a “significant” share of the top 20 products that India imports from the world. This includes a 45 per cent share in India’s total electronics imports, a third of machinery and almost two-fifths of the country’s global organic chemical imports.

India sources 65-70 per cent of active pharmaceutical ingredients and nearly 90 per cent of certain mobile phone parts from China.

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