India’s petrochemical industry is working with the government to prepare a “negative” list of duty-free imports of finished plastic goods that are weighing on the profit margins of domestic producers, as per a government official reported in ICIS. The domestic market is not able to compete with these imported finished products as the raw materials they use to make similar goods have import duties imposed on them and this has eroded their margins, according to the official from the department of petrochemicals under the ministry of chemicals and fertilizers. The government is now studying duty-free imports of several plastic product categories from countries such as Thailand, Singapore, Vietnam and Malaysia that India has signed free trade agreements (FTAs) with the aim of drawing up the negative list of products to end this situation, the official said.
The review of the existing FTAs and framing a negative list of plastic product imports is also critical for the domestic industry because India is working towards a similar trade agreement with six countries of Gulf Co-operation Council(GCC), one of the largest base of petrochemical majors. It was important to remove such issues involving the import duties before FTA was signed with the GCC, which has larger petrochemical producers, the sources added.