Can India Afford To Reject Chinese Products? Find Out Why It’s Not An Easy Call

It is easier said than done because India’s trade with China explicitly shows our dependence on the country for sourcing various goods.

Activists of Aam Adam Party Trade wing hold placards during a protest against Chinese products. (Image: PTI)

New Delhi:  In the aftermath of Indo-China border skirmishes which escalated leaving 20 Army personnel martyred during the face-off at the border have shaken the citizens who are calling for boycotting of Chinese products in India. Made in China products have invaded every inch of our household even as traders and manufacturers are hugely dependent on raw materials and imports from the neighbouring nation. Even as the government has started focusing on India’s manufacturing and create indigenous products that can compete in the global market, the idea of boycotting Chinese goods doesn’t resonate well given our limited capabilities. However, Confederation of All India Traders body had released a list of over 450 broad categories of commodities, which have over 3,000 Chinese products, according to the ThePrint. According to the report, the trade body, which has a 40,000 associations and a network of 7 crore traders has circulated the list to all of them for action. The list released by CAIT broadly includes everyday-use items, including FMCG products, consumer durables, toys, furnishing fabrics, textiles, builder hardware, footwear, apparel, kitchen items, handbags, cosmetics, electrical and electronics, fashion apparel, Diwali and Holi items, among others. Can the government afford to boycott Chinese goods? It is easier said than done because India’s trade with China explicitly shows our dependence on the country for sourcing various goods. Here’s the import-export trade data between China and India. Export-Import Data Bank: India and China (2018-19) (value in Rs) Export: 1.17 lakh crore Export share - 5.08% Import: 4.92 lakh crore Import share - 10.32 % Total Trade: 6.09 lakh crore India's Trade Balance: -3.75 lakh crore Source: Department of Commerce; GOI (Dated: 18/06/2020) The boycott of Chinese products is feasible if there is an alternative resource that can match up to the cost and availability of Chinese products.The economic decisions at the government level will have to take a practical approach because several industries are dependent on imports from that country. The limited production capabilities of the country had enabled China to emerge as the biggest exporter of consumer products coupled with technological advancement in terms of machinery and industrial resources also helps China to export products at a lower price than the importing country's market price or its cost of production. Is it possible to challenge the status quo? It can only be possible given the trade gap between both the nations is narrowed which can happen if we try to imbibe 'Atma Nirbhar Bharat’ and focus on delivering the vision for Made in India products. However, it is still far away before India becomes self reliant and starts fulfilling the demand of domestic industries. However, India can get involved in trade wars like the US. It may consider extending anti-dumping duties and safeguards on Chinese goods on products starting from calculators and USB drives to steel, solar cells and Vitamin E. But by doing this domestic manufacturers may lose duty protection against such products, as per the Hindustan Times report. Anti-dumping duties were imposed around five years back which are expiring this year. Around 100 Chinese products can be impacted by anti-dumping actions including future investments from China. The economic ties may also be hampered with the Chinese firms bidding for important projects such as the 5G market, as per the report. The solar industry will be badly affected because of its dependence on raw materials sourced from China. What should you do as a citizen? China makes up for a huge chunk of the domestic mobile phone market which is at present dominated by Chinese brands like Xiaomi. While the telecom equipment industry can look up to several Amercian and European vendors and afford to boycott Chinese vendors. Even as the idea to ban Chinese products may not look practically doable, but on a personal level citizens can start using homegrown brands or other brands which will definitely make a case against China by challenging the market share of its product in the country.