New Delhi . Chinese companies have looked at other countries to sell their goods amid growing trade tension between America-China. This is the reason why they are ready to sell goods to India at cheap prices. Chinese companies are offering exemption of up to 5 percent to Indian buyers, which raises hopes that the prices of electronic goods in India may be reduced, but experts believe that despite this exemption, the path of cheap electronic goods in India will not be so easy. There are many economic, policy and practical reasons behind this.

India buys these components from China
India is currently buying very important electronic parts from China. These include separate chips, copper tubes, television panels, circuit boards, battery cells, display modules, camera modules and printed circuits etc.

Chinese companies in a hurry to sell goods
The US has imposed an additional 125 percent retaliation on China, which has come into force. This has made the sale of Chinese electronics products almost impossible. In such a situation, Chinese companies are offering five percent discount on electronics parts (components), where the profit margin is quite low. Anyway, raw material reserves as electronics components are ready for three months. In such a situation, the goods will remain with the companies for a long time, their loss will increase. Therefore, Chinese companies are in a hurry to increase their sales in India at the earliest so that they can be able to deal with the shock from America to some extent.

Indian buyers may have problems
Experts say that even though Chinese electronics components are interacting to sell goods on very low margins, Indian buyers do not have the scope to shop even at reduced prices. Because America has also imposed a 26% fee on India.

Even though it has been postponed for 90 days, Indian companies will have difficulty in selling their goods in America, so they can hesitate to ask for raw materials cheaply. At the same time, the store of raw material is ready for three months. According to this, Indian buyers will be interested, then they will give orders to Chinese companies in May-June itself.

Government's quality instructions are very clear
The government in the country is emphasizing the domestic production of electronics parts in India through the incentive scheme (PLI Scheme) and Quality Control Order (QCO). Quality orders on imported electronics parts are also clear. At the same time, the import duty on electronic goods and their components in India is still quite high. The government is also increasing import duty to promote Make in India. This will not affect the prices due to the import duty and GST implemented after bringing these goods in the country.

The effect of weakness of rupee also
The value of the Indian rupee has been continuously weakening in the international market. Payments from Chinese companies to buy components are usually made in US dollars. The total cost of import increases due to weakness of rupee, which makes the benefit of exemption neutralized. This situation also weakens the expectation of cheap electronic goods.

Will companies benefit customers?
Tarun Pathak, director of Counterpoint Research, an organization that monitor the mobile phone market, says that it is possible that electronics goods in India will become somewhat cheap. Now it will depend on the companies to keep all the money of savings with them or give the benefit to the customers as well. Since India will also face American fees, companies can compensate for their losses first.

Government can impose dumping fee
The central government is preparing to take strict steps to prevent imports of cheap Chinese goods. The government will accept the decrease in prices to a limit, but after that the government can levy a fee to stop dumping of goods. India plans to preserve its market after the US imposed heavy tariffs on China.

Officials say floods of cheap Chinese products may cause damage to domestic industries, considering minimum import price, protective and other measures. Markets and goods are being identified which need protection.