China is well ahead of India in at least one sector of international trade, but Indian exporters would be well advised to stay away from it. It is the trade in counterfeit and pirated goods-imitation watches sporting the Rolex brand name, ready-to-wear garments bearing a fake Ralph Lauren label and trainers with the Nike logo prominently displayed.
Trade in such products is big business and Asian countries are among the leading suppliers. China accounted for 60 per cent of the counterfeit goods entering the 15-nation European Union (EU) and their seizure by Customs authorities in 2003, the latest full year for which the EU has statistics.
India is so far down the list that it hardly figures. It accounted for 8 per cent of ?other goods? seized by Customs, as compared to 55 per cent in the case of China and Hong Kong. Thailand is another country from which a high proportion of counterfeit and pirated goods originate. Nearly 30 per cent of the cases registered by EU Customs authorities in 2003 related to goods shipped from Thailand, as against 18 per cent in the case of China and 3 per cent of Pakistan.
The new EU-China agreement on Customs cooperation is seen here as an important step in the fight against fraud and counterfeit. The EU notes, however, that the country from which goods are shipped may not necessarily be the real country of origin.
Trade in counterfeit goods obviously is at the expense of the companies whose brand names and copyright are being illegally used.
But its victims include exporters of legally produced goods. If you buy a fake Lacoste T-shirt, you?re not in the market for the genuine article, or for even a good quality but a branded T-shirt.
EU Customs authorities seized nearly four million items of counterfeit clothing (sportswear and ready-to-wear garments) and accessories (bags, sunglasses, etc.) in 2003. The figure rose to almost 5 million during the first nine months of the last year.
Clothing and accessories accounted for just over 60 per cent of the cases registered by Customs authorities during the first nine months of 2004. CDs (audio, games, software, DVD, etc.) accounted for 14 per cent, watches and jewellery for 9 per cent and ?other goods? for nearly 7 per cent.
The most detailed statistics do not reveal what proportions of counterfeit and pirated goods are getting past the Customs-on traveller'swrists, for example. The Paris-based International Chamber of Commerce stated in 1997 that counterfeit goods accounted for 5 to 7 per cent of world trade. The World Economic Forum put the cost of counterfeit and piracy at 450 billion euro (one euro is worth approx. Rs 56).
(The India News in Europe Programme (INEP) is a news service providing news, information and in-depth coverage for Indian media from Brussels. The material is free for use but a credit line to INEP is desired.)