Banning Chinese goods in India: Easier said than done. Here's why
Chinese products are deeply integrated into the Indian economy; here is a reality check on 'ban-Chinese products' protestsTwitter image

Banning Chinese goods in India: Easier said than done. Here's why

There has been a huge outcry over banning of Chinese products following Ladakh standoff in which 20 Indian soldiers lost their lives. But it's not going to be easy

Guwahati: There has been a sudden demand over boycotting of Chinese goods in India following a violent face-off with China in Galwan Valley in Ladakh on Monday night (June 15) that resulted in the death of 20 Indian soldiers.

Soon thereafter, several anti-China protests erupted across India, including parts of Assam and Arunachal Pradesh on Thursday, with people burning effigies and raising slogans against the neighbouring nation. Many people even started to "destroy" ‘made in China’ products, including television sets.

However, the ground reality is not that simple and easy as it seems, for the ‘ban Chinese products’ call can only work for a short-time but will become less feasible in the long run. India not only relies on China for finished goods but also depends heavily on intermediate goods which are used for production.

Talking solely about smartphones, companies like Xiaomi alone captures 30% market share in the Indian smartphone market (as per Q1 2020 data) after achieving a 6% year-on-year growth. Another Chinese smartphone maker, Vivo, has a 17% market share followed by Realme at 14% and Oppo at 12%. No prizes for guessing, Realme and Oppo are also Chinese companies.

Even American tech behemoth Apple, which says that iPhone is “built everywhere in the world”, has most of its components coming from China.

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It is safe to say that at least 75% of the smartphones sold in India are developed by Chinese companies as homegrown firms lost the race when the era of 4G came. According to a study, the number of smartphone users is expected to rise by 84% to 859 million by 2022 from 468 million in just 2017 in India.

China alone accounts for approximately 67% of imports in the electronic components sector with market size of Rs 5,300 billion. Objects like integrated circuits and semiconductors which are the heart of modern electronic devices like laptops and phones are some of the components that India buys from China.

In the consumer durables sector, India imports 45% of its products like ACs, refrigerators, and televisions from China. This sector is estimated to be around $11.2 billion (Rs 763 billion) in the financial year of 2019. Moreover, 45% of smart TVs that are sold in India are Chinese made. India is also quite dependent on China for auto components as 18% of those comes from them.

Electrical components are not all, as in April to December 2019, India imported $2.6 billion worth of pharmaceutical chemicals and this $1.8 billion active pharmaceutical ingredients (API) come from China. Hence, 67% of India’s APIs come from China. China’s API and drug imports from China are on such a large scale that even the Food and Drug Administration (FDA) has no clue of the dependence of the US on China for drugs.

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Imported leather goods, particularly shoes, come from China which is about 38%; $460 million worth of synthetic yarn and $360 million worth of synthetic fabric comes from China. India also imports over $140 million worth of accessories like zippers, buttons, needles, and hangers.

And it’s not just the hardware that China has a grasp on. Apps and software like the infamous TikTok, UCBrouser, SHAREit, PUBG Mobile, Xender, Helo, Clash of Kings, BeautyPlus, Club Factory, etc, are just a few Chines creations that can be found in almost everyone’s cellphone.

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TikTok has a billion+ downloads globally and India is one of the biggest markets with monthly users at approximately 120 million. The social networking app Helo, which was launched by TikTok owner Bytedance, was tailored specifically for the Indian market.

So, if India openly bans all Chinese products, it would mean uninstalling all the apps including the favourite PUBG game in the Chinese made Realme, Vivo, or Oppo phones and then throwing away those phones as well. This is just a minuscule aspect of the entire movement. Sounds simple enough?

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