Chinese companies demand full advance payment for Diwali LED lights

New Delhi: Indian buyers are keen to import festive LED lights for Diwali in the absence of reliable local supply but Chinese companies are demanding full advance payment as they are concerned about changes in India’s trade policy or tariffs, traders said.

Import of other festive products such as idols and gift items from China is likely to fall as Indian products are available, although at a higher price, they said.

Chinese items are usually imported in July and August in major Indian ports. According to industry estimates, India annually imports festive lights valued at over Rs 1,000 crore and gift items at Rs 3,500 crore, with 70% to 80% of the sale during the Diwali period.

The domestic market depends heavily on China for decorative lights, especially the LED ones, said Bharat Ahuja, president of traders’ association in Delhi’s Bhagirath Palace that has 3,800 shops.

“Quality and pricing has kept Chinese lights in the forefront,” said Niren Dharia, past president of Electric Merchants' Association at Lohar Chawl in Mumbai. “This year also people are importing, although Chinese traders are asking for full payment in advance, unlike the past when they gave one-month credit. Domestic production is largely in the unorganised sector and very seasonal.”

He said traders were waiting for policy clarity. “It usually takes two weeks for ships to arrive, so we can import by August,” Dharia said, adding local industry is seasonal and unbranded, while Chinese imports worth an estimate Rs 1,000 crore dominate the market.

For idols and gift items, Swadeshi Jagran Manch and Confederation of All India Traders (CAIT) hope to replace Chinese imports with local products. “We are in talks with manufacturers to make other gift items for Navratras and Diwali,” said Mahesh Bakhai, co-convenor of Swadeshi Jagran Manch.

There is a big demand for idols and diyas during Diwali, said Ashish Goyal, an importer of idols and gift items. “Purchase from Moradabad, Jodhpur, Meerut, Mumbai and Delhi will increase this year by 20% to 25%,” he said, adding about 1,500 containers worth Rs 25 lakh each were annually being imported in the country.

Meerut-based idol and gift manufacturer Deepak Singhal of Royal Art Collection said demand for Indian idols and other gift items has started rising. “We are expecting domestic sales to definitely increase by 25% this year, with Indian traders not keen to import from China. Our prices will be 15% higher than China, but we assure quality to our buyers,” he said.

Colourful stones, beads and sequin rakhis from Kolkatta, Ahmedabad and Jodhpur are currently being sourced for the rakhi festival, which falls on August 3, said Praveen Khandelwal, secretary general at CAIT. “Imports of dori, beads, rubber figures and LED light rakhi from Thailand and China have not taken place this year. People who have old stock of the previous year, may sell this year too but our target is to push for Indian products for a stronger Atmanirbhar Bharat,” he said.