Manufacturing in India with Chinese investment or equipment
China is the largest source of capital equipment for several of the sectors growing fastest in India, including solar manufacturing and battery storage. Three things shape how MOOWR applies.
Investment approval comes first
Under Press Note 3 of 2020, foreign direct investment from countries that share a land border with India, which includes China, needs prior government approval. That approval sits outside customs and has to be planned before the unit is set up.
Anti-dumping duty is part of the picture
A number of goods of Chinese origin attract anti-dumping duty in India. Where it applies to inputs, it is deferred along with the other customs duties under MOOWR, which can make the deferral worth more than the basic rate suggests.
No trade agreement to compare against
India has no free trade agreement with China, so there is no preferential rate to weigh against MOOWR. The full duty applies at import, and that is the duty MOOWR defers.