Anti-China sentiment has been on the rise in India since past few months amidst the border tensions.
20 Indian soldiers were killed in fighting at a disputed border site in the Himalayan Galwan Valley.
Normal people, Celebrities, Activists across the country have thrown Chinese TV sets, mobile phones down their balconies. While traders in the capital, Delhi, protested by burning Chinese goods.
The Indian Railways have reportedly cancelled a signaling project that was given to a Chinese company in 2016. The government has also asked e-commerce companies to display the country of origin for the products they sell.
But, easier said than done there is a lot more back stage than what is appearing to our eyes.
Do we really have an alternative?
China is India’s second-largest trading partner after the US. It accounts for nearly 12% of India’s imports across sectors such as chemicals, automotive components, consumer electronics and pharmaceuticals.
Pharmaceuticals:
At least 70% of India’s drug intermediary needs are fulfilled by China. Although India has announced a new policy to become more self-reliant in drugs, it will definitely take time for our country to become self-reliant.
Our PM has started a new project- AatmaNirbhar Bharat, which is highly required at this time. But one has to keep in mind that anything requires time and it cannot happen over night
Smartphones:
India’s booming smartphone sector is also heavily dependent on cheap Chinese phones made by Oppo, Xaomi and others with the lion’s share of the local market which is close to 50%
Consumer Electronics
Most consumer electronics makers will be paralyzed if they can’t import crucial intermediate goods from China.
Most players across the globe import key components such as compressors from China, Many industry experts say that it will take a long time to set up local supply chains, and that there are few alternatives for certain kinds of imports.
Chinese Investments fund Indian Unicorns:
India and China have also become increasingly integrated in recent years. Money from China, for instance, has penetrated the India's technology sector. With companies like Alibaba and Tencent strategically pumping in billions of dollars into Indian startups such as Zomato, Paytm, Big Basket and Ola.
There have been more than 90 Chinese investments in Indian startups, most of them made over the last five years. 18 out of 30 Indian unicorns [tech startups valued at over $1bn] have a Chinese investor
At $6.2bn, direct Chinese investment in India appears relatively small. Restricting the likes of Alibaba from creating monopolies in the Indian market will be the need of the hour.
India has already amended its FDI (foreign direct investment) rules to stave off hostile takeovers of Indian companies.
Ban of 106 Chinese Mobile Applications:
India in total has banned 106 apps which have links with China. The most popular banned apps are TikTok, Helo, Shareit, UC Browser, CamScanner, Baidu Map, Bigo Live Vigo Video, Likee, Mi Video Call - Xiaomi, Clash of Kings as well as e-commerce platforms Club Factory and Shein and others.
Some reports also said 275 other Chinese apps could also be on the chopping block over similar concerns, including the hugely popular "PUBG Mobile" game owned by tech giant Tencent.
Is self-reliance the answer?
- According to a report India’s domestic manufacturing sector can substitute as much as 25% of total imports from China. This would lead to a reduced import bill of over $8bn in a single year.
- Handicrafts, for instance, is a category where India imported $431m worth of goods from China in the 2020 financial year without any significant reciprocal exports.
- But from India’s standpoint, none of this is likely to play out without grave consequences to the economy, especially during a severe downturn. China, on the other hand, is less concerned since India accounts for only 3% of its exports.
My View:
After deeply studying the Indian economic ties with China and on the global front, we have to now be self-reliant. Today it is China and tomorrow it might be the U.S, Japan or some other European countries. We need to have the following in place for the P.Ms Aatma Nirbhar Bharat to shine-
- MSME sector should be relooked and we should start manufacturing products from minute ones to big giant machinery. China is the export hub because its products are cost effective. The Chinese products are cost effective because it has the manufacturing infrastructure which nobody in the world has. India should also strive for that excellence in manufacturing.
- Incentives for startups, businesses
- Subsidies for land-power-water-taxes all these aspects should be relooked so that entrepreneurship will come to the forefront
- Easy clearances for the basic requirements setting up of an industry
- Policies should be rolled out in such a way that we are first self-reliant in what we want and then go export/import
- We should make use of the 1.38 billion people of India which itself is a huge demand
- Before buying a product, people should make a habit of checking who the manufacturer of the product is and then buy it. It is just like checking from which restaurant we are ordering the FOOD!
- Celebrities, Public figures should stop breaking Chinese products and educate common people on why we should buy Indian products here after(though the price is on the higher side) rather than being emotional and creating ruckus in the Media
- People should here after stop taking emotional decisions and start taking logical decisions. Once they decide on something they should stick to it. In case the government rolls back some of the policies also they should be true to what they decide
- This may take decades of time, but somewhere the thought process and ground work should start so that at least the coming generations will eat the fruits
We should be first self-reliant and then export/import
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PK,
PK Enterprises.
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