The Narendra Modi government has asked the industry to prepare a detailed list of all purchases from China and flag those critical to operations so that non-essential imports that can be substituted with local products can be identified. Sources said this was among the many measures the Centre is considering in the government’s stepped-up efforts to reduce India’s dependence on China in the wake of the border crisis.
“In line with decision taken at the highest levels of the government to reduce our dependence on China, the DPIIT (Department for Promotion of Industry and Internal Trade) has reached out to trade associations, seeking a list of items imported from China ranging from automobiles, pharmaceuticals, toys, plastics, furniture, etc by Monday,” a senior government official said.
The focus has switched to the private sector after moves to bar Chinese companies from participating in central government contracts.
It is believed that the Doklam standoff had ended partly because China was concerned it would lose the huge Indian market. While that scenario may repeat in the case of Ladakh, ADB has projected a mere 1.8% growth of the Chinese economy post-coronavirus pandemic. China, realising that its ostensible objective to turn the largest economy in the world has unravelled, now wishes to retain all the markets it has, sources in Beijing said.
Meanwhile Fitch said India could register 8.5% growth post-COVID while Standard & Poor’s predicts a 9% growth of India in 2021-22 ― provided the Modi government undertakes reforms in the financial and labour sectors.
The boycott of Chinese goods and components may increase the cost of Indian industry by up to 15%. However, that is a price the nation is ready to pay, given the sense of hurt and anger that prevails in India since the news of the ambush of Indian Army soldiers by the PLA on 15 June arrived, informing the nation of the avoidable death of 20 jawans by Chinese troops who attacked them while returning from a major general-level meeting late in the night with clubs wrapped in barbed wire. Honouring the convention and spirit of a military meeting, the Indians had arrived at the venue unarmed while the Chinese couldn’t care less about gentlemanly conduct. Yet, reports suggest the Indians fought bravely, killing or injuring 43 Chinese soldiers.
The ambush has projected China as a treacherous and unreliable nation with which any country should do business. Earlier, countries led by Japan had decided to move their business interests out of China due to Beijing’s alleged conspiracy to unleash coronavirus on the world. While a chunk of that business has gone to Vietnam, the Indian states of Uttar Pradesh, Gujarat and Tamil Nadu are attracting the industry houses fleeing China. Strategists say that China might have escalated tensions along the Line of Actual Control to ensure, among other things like furthering its expansionist agenda, a disruption in the process of revival of the Indian economy.