- Mar 24, 2009
I tend to agree with L&T. The Chinese by way of controlling its currency and closed economy is killing competition. If India was to devalue its currency and fix it at say Rs 60 to a dollar and peg it at that level, i am sure other countries would cry hoarse.SURAT: Private sector engineering major Larsen & Toubro has said that China is systematically killing Indian manufacturing sector and sought 25 per cent anti-dumping duty on Chinese goods.
"China has a fixed currency. It is not a market economy like ours. China is systematically killing the Indian manufacturing sector," L&T chief Naik, who was here for foundation stone laying ceremony of a forgings unit at Hazira told reporters here yesterday.
"There are taxes on goods manufactured locally, but none on imported products (from China). This is an unfair situation for Indian goods. This is why there should be 25 per cent anti-dumping duty on Chinese products," Naik said.
Speaking specifically about power equipment sector, in which L&T is a major player, Naik said, "The Indian power companies, especially those in the private sector, have placed huge orders for power plant equipment with China. We can say that Chinese power sector is virtually working for India."
"It is not good that 80 per cent of our dependence for power plant equipment is on one country, and that too China," he said, adding that China should not be allowed to grow at the cost of Indian companies.
"The day China opens its economy, its prices are bound to go up by 25 per cent," he said. "But unfortunately we are not taking any steps to stop it," Naik further said.
L&T's special steel manufacturing and ultra heavy forgings unit at Hazira is a joint venture with Nuclear Power Corporation of India Ltd (NPCIL), in which L&T holds 74 per cent stake while the latter 26 per cent.
The plant is being set up at an investment of Rs 1,750 crore, and will supply finished forgings for nuclear reactors, pressurisers and steam generators, besides heavy forgings for critical equipment in the hydrocarbon sector, as well as thermal power plants and steel plants. The unit is expected to begin operations between March and May next year.
L&T is also investing over Rs 5,000 crore for setting up facilities to manufacture boilers, turbines, modular fabrications. It is also establishing a ship-building unit and a power plant at its Hazira facility.
"The boiler shop will be opened in March or April this year, which will be followed by the turbine shop in August or so," Naik said.
What is also needed is a sustained international effort to put pressure on China to stop its unfair trade practice by means of controlling its currency and market.
But i read just a few days back that the officials of the CCP have made it clear that they do not intend to let its currency free anytime soon if at all.