The government is deeply concerned with the import restrictions that India has imposed on products from China recently and hopes India would use these measures more carefully, the Ministry of Commerce said in an announcement on its website yesterday.
India has started 17 trade remedy investigations on products from China since October 2008. Related products include linen fabric, tires and hot rolled steel, which are valued at $1.5 billion, according to the Ministry. It has also restricted the import of steel, chemical products and textile products from China recently.
In addition, India announced that it would ban toys from China for six months beginning Jan 23, 2009. Those actions complicate the $50 billion trade relations between India and its largest trade partner.
After India announced the toy imports ban, China said it would likely ask the World Trade Organization to probe whether the ban violates WTO laws.
India imported 1.2 million toys per week from China on average during 1992 to 2003, and China's toys claimed an 80 percent market share in India in 1997.
"The case of toys is a case of multiple interests at work," said Subir Gokarn, chief Asia-Pacific economist of Standard & Poor's. "The domestic industry is completely non-competitive with respect to Chinese, and they have been finding themselves hammered."
After the ban, some analysts suggested, demand for Indian-made dolls, stuffed animals, puzzles and other playthings could surge by 30 percent.
Dong Shizhong, Fudan university law school professor and an expert in WTO dispute settlement mechanism, said: "After the import restriction to China's toy industry by India, with the spread of recession worldwide, more trade barriers will appear."
China hopes India uses trade remedy measures more cautiously as the world economy is faced with grim challenges, said Yao Jian, spokesman for the commerce ministry. Yao said both G20 and APEC members have pledged to act against trade protectionism, and the two sides need to have more communication and cooperation to achieve mutual benefits.
Vice-Minister of Commerce Zhong Shan met with Nirupama Rao, Indian ambassador, in Beijing on Feb 3, where he expressed the hope that better communication would defuse trade tensions between the two nations.
China-India bilateral trade rose 41.6 percent to $48.38 billion in 2008, when India became China's No 10 trading partner.
