Incense exports brought about 76.8 million USD, reducing the risk of "shock"
11:25 - 01/12/2020
The export of incense (incense) of Vietnamese enterprises is being threatened by the only market that India has issued a policy of "import restriction" instead of allowing "free import" as before.
Incense exporter: "We're going to go bankrupt already"
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| India is currently the main export market for incense (incense) (there is no alternative market) of the incense (incense) industry for Vietnamese exports. The country currently has more than 100 enterprises producing incense (incense) in the North, Central and South. |
Businesses worry about losing export markets
According to the Ministry of Industry and Trade, at the end of August 2019, the Indian Ministry of Industry and Trade (General Department of Foreign Trade) issued Notice No. 15 / 2015-2020 on the adjustment of import policy for incense (incense) - Agarbatti.
Accordingly, the import of incense (incense) (HS code 33074100) and other preparations (HS code 33074900) into India was changed from a state of "free import" to "import restrictions". The announcement takes effect on August 31, 2019.
India's sudden application of licensing regime for incense (incense) imports (effective at the time of notification), without prior notice has created serious difficulties for Vietnamese businesses.
According to the Asia-Africa Market Department, India is currently the main incense export market (there is no alternative market) for Vietnam's incense export. The country currently has more than 100 enterprises producing incense in the North, Central and South.
"On average, Vietnamese businesses export more than 300 containers of incense products each month to India (Vietnam's export turnover to India in 2018-2019 is 76.85 million USD). However, the restriction on imports of Indian incense according to the above-said notice causes export activities of enterprises to stop immediately.
Some large enterprises exporting incense stick are based in Hanoi and Hung Yen, such as: Anh Hong Company Limited, Duc Thanh Company Limited, Viet Khoi Import-Export Company Limited, BHA Vietnam Import-Export Co., Ltd, T&K Vietnam Manufacturing Co., Ltd., Khai Hoan ... said that businesses had to stop transporting goods under contracts. Meanwhile, September every year is the peak month for incense exports to India to serve India's biggest holiday in October.
It is known that Vietnamese enterprises focus on human, financial and raw materials to produce goods. The amount of inventories is very large, cannot be exported to other countries because there is no alternative export market. The factory must suspend production, directly affecting businesses and jobs and the lives of thousands of workers.
Ministry of Industry and Trade stepped in
Immediately after receiving information from manufacturers, representatives of the Asia-Africa Market Department, the Import-Export Department (Ministry of Industry and Trade) had a meeting with some of the above-mentioned large incense exporting enterprises. .
To remove difficulties for businesses, Minister of Industry and Trade Tran Tuan Anh signed an official letter to the Minister of Industry and Trade of India expressing his concern and opposition to the above measures of India, and suggested the Indian side first. Eyes do not require an import license for incense shipments from Vietnam that have signed sale and purchase contracts before August 31, 2019.
The Minister also suggested that India consider and temporarily suspend the application of import licensing measures during the time of market demand peaks (September and October 2019) and in the long term cancel the regulatory measure. import agent for incense products.
According to statistics of India, the import turnover of incense incense of India (HS code 33074100) has continuously grown over the years. In 2018-2019, India imported US $ 83.58 million of incense from countries around the world.
The two main exporters of incense to India are Vietnam and China. In particular, Vietnam always accounts for about 90% of the import market share of India for incense (HS code 33074100). The reason that Vietnam dominates India's import market share of incense is because Vietnam has the advantage of preferential tariff rates under the ASEAN - India Trade in Goods Agreement with an import tax of 5% (from 01). / 01/2016).
The application of India's import restriction on incense may stem from the low cost of Vietnamese incense (CIF 600-650 USD / ton) compared to the cost of Indian manufactured products. , affecting the incense production industry, affecting many Indian businesses.