Bangalore : Larsen & Toubro (L&T) Ltd chairman and managing director A.M. Naik Thursday sought 25 percent anti-dumping duty on Chinese capital goods till the Chinese currency was floated.
"Till China floats yuan, the Indian government should impose 25 percent anti-dumping duty on Chinese capital goods. Even as the floating Indian rupee appreciates, China continues to have fixed currency. As a result, Indian goods are facing unfair competition," Naik told reporters here.
Naik also urged the government to take up the issue of the Chinese fixed currency with the WTO for ensuring a level-playing field for Indian capital goods in the domestic and international markets.
"Though China has been admitted to the WTO, it continues to keep its currency fixed at 7.3 yuan per one US dollar. If it floats, it will become 5.5 yuan per $1. Apart from rupee appreciating and making exports less competitive, the Indian manufacturing sector is burdened with a slew of taxes, impacting the margins by a whopping 35 percent," Naik pointed out.
Admitting that import of Chinese capital goods was affecting the competitiveness of Indian goods, Naik said if the domestic manufacturing sector had to survive the onslaught, slapping the anti-dumping duty would give a relief of 25 percent indirect export subsidy to Indian firms.
Indian firms import Chinese machinery valued at $10-12 billion every year. China has piled up trade surplus to the tune of $23 billion. "And at the way we are going, in three years, China will have a trade surplus of about $50 billion over India. We export only commodities like iron ore. It is only L&T that is exporting machinery to China valued at Rs.1 billion per year," Naik disclosed.