The government has already hiked customs duties on scores of items in recent years to discourage inflows of select items, ranging from electronics items such as AC and refrigerator to jewellery.
The commerce department has asked the revenue department to clearly identify each product in the ‘others or miscellaneous goods’ categories so that imports of each item can be better monitored, a senior government official told FE.
A customs official said the value of imports under such categories has come down drastically in recent years due to better classification of goods. Nevertheless, more steps can be taken in this direction to further bolster this system, he added. Imports under the ‘miscellaneous’ goods category – which made up for as much as $7.1 billion, or 1.8% of the country’s total merchandise imports in FY17 – stood at $15 million in FY17 and $51 million in the last fiscal, thank to an upgrade of the classification system in recent years, said the official.
For its part, the commerce ministry wants to ensure that the classification system should be strengthened in such a way that unscrupulous elements don’t get a chance to push unclassified commodities into the country in large volumes without causing a flutter. The move comes at a time when the ministry is tightening its scrutiny of irrational spike in imports or illegal trading and has also stepped up efforts to promote the Make in India programme.
India has been seeking to contain its trade deficit, which hit a six-year high of $176 billion last fiscal, according to a quick estimate of the commerce ministry. Reining in non-essential imports is part of the drive to curb the trade deficit.
The government has already hiked customs duties on scores of items in recent years to discourage inflows of select items, ranging from electronics items such as AC and refrigerator to jewellery. In September last year, basic customs duties were raised on 19 tariff lines that accounted for an import bill of Rs 86,000 crore in FY18 by 2.5-10 percentage points. It was followed up by another round of hike last year on scores of other items. The government is planning another round of hike on items, including toys and furniture, in the current fiscal.