Concerned that China’s currency devaluation may affect Indian manufacturing sector, a senior government official today said India needs to strengthen its anti-dumping mechanism, especially in sectors like steel.
“China has created a huge amount of capacity. India needs to lay down standards, it needs to have very strong safeguards, it needs to strengthen its anti dumping mechanism,” Department of Industrial Policy and Promotion Secretary Amitabh Kant said today.
He was replying to queries about the impact of yuan devaluation on the Indian manufacturing and exports.
“India needs to take care of its primary sectors such as steel so that it is able to tackle this large capacity of China which will be looking for markets like India. Therefore, India needs to prepare itself for that to protect its industries,” Kant said here on the sidelines of the SBI Conclave.
Last week, an unexpected devaluation of the yuan by China saw it plunge the most in about 20 years, sending shockwaves across the currency markets globally. Among others, rupee was also affected, but RBI is said to have intervened in the forex market to cushion the drop.
The Chinese central bank lowered its daily reference rate by 1.9 per cent last Tuesday, a move termed by many as an effort to cushion weakness in its economy.
Concerns have been raised in various quarters that the yuan devaluation may lead to increased dumping of Chinese exports into the Indian markets and hurt the competitiveness of Indian products.