India's New PVC Import Rule Could Raise Costs for Construction and Building Products

India's New PVC Import Rule Could Raise Costs for Construction and Building Products

India: India has introduced a minimum import price (MIP) on Suspension Grade Polyvinyl Chloride (S-PVC) resin, a material widely used in construction products such as pipes, plumbing fittings and electrical conduits. Under a notification issued by the Directorate General of Foreign Trade (DGFT), imports with a Cost, Insurance and Freight (CIF) value of USD 0.766 per kg or below will require a DGFT licence for six months, while imports above the threshold will continue under the existing import policy. Imports by Export Oriented Units (EOUs), Special Economic Zones (SEZs) and under the Advance Authorisation Scheme remain exempt when used for export production.

According to the Global Trade Research Initiative (GTRI), the measure could increase domestic PVC resin prices, leading to higher input costs for manufacturers of construction and infrastructure products, including water pipes, plumbing fittings and electrical cables. As India imports around 64% of its S-PVC resin requirements, the restriction is unlikely to significantly reduce import dependence. GTRI also noted that clarification may be required regarding the policy after the six-month period, as the notification and its explanatory note provide different interpretations of the scope and duration of the restriction.

Source: Economic Times