The Great China Ban
Day in and day out, we receive messages to boycott Chinese products. News channels are talking about it all day. It started with Wangchuk’s video which went viral on social media. The implications of importing from China is injurious. India’s ban on China could be useful to us in many ways.
So many of us have consciously stopped buying Chinese products. My family business used to deal with Chinese electrical goods. We put a stop to it years ago. So many around me have been doing the same. My neighbor was ready to lose a sum of 20 lakh he paid in advance to a Chinese furniture brand. Yes, all of us have been patriotic. But are we being sensible and rational? Many have argued about globalization. Meaning, a lot of products that we use might have their parts manufactured in China but assembled elsewhere.
India has been raising the import duties since the last three budgets. This will give a boost to local manufacturers to produce cheaper alternatives. Recently, India has been holding all shipments coming from China. As a part of the anti-Chinese movement, 150 Foxconn shipments containing smartphones and electronic parts are stuck in the ports of Chennai. This is a good move. It has resulted in Apple moving its manufacturing unit to India. Also, Apple saves almost USD 100–200 on import taxes. This in turn makes the iPhone cheaper.
The question is, can this be done for all products? The major problem is that India imports a hefty amount of raw materials from China. This includes more than 8,000 items and a total of INR 4,40,101 crore worth of imports. The important fact to note is that imports from the USA amounted to INR 2,36,933 crore, which is way less compared to China. 60–70% of pharmaceutical ingredients for many common medicines like paracetamol are imported. Delaying clearance of such ingredients might not be the very best option. India has to step forward to make a replacement facility for such raw materials. Bajaj used INR 1,000 crore of Chinese components. But it also exported two and three-wheelers worth INR 15,000 crore. This would not have been a bad thing if Bajaj could have bought all the components from India.
The government also banned 59 Chinese apps. A lot of these apps had a huge consumer base in India. With the ban, the tech companies are likely to suffer a major setback. Apps are one field where India can compete on a global level. Narendra Modi launched the “Let us code” campaign. It focuses on giving a boost to the Indian startup ecosystem to create alternative apps. Chingari, a TikTok alternative, has already seen 10M plus downloads. KagazScanner, a replacement to CamScanner saw 100k in only 24 hours. India's ban on China is going to have major implications for the Indian startup ecosystem.
It is really crucial for us to think at a global level and multi-dimensional level. And we must think about why we are where we are. China has attained domination in the world economy. Although it might be really hard to be the next China, it is not impossible.
