Indian politicians are currently leading a campaign to boycott Chinese goods. But an India Spend analysis shows why this will fail
. China is India’s largest trade partner, a sixth of India’s imports are Chinese, up from a 10th in 2011-12, while India’s exports to its rival have halved over the same period.
Imports from China grew at 20 per cent over two years and 5 per cent over five years, to $61 billion. These goods range from power plants and set-top boxes to Ganesh idols. This is despite the fact that India’s imports have generally fallen over the last five years from $490 billion (Rs 23 lakh crore) to $380 billion (Rs 25 lakh crore) –because of a fall in global oil prices.
India’s exports to China have fallen from $18 billion (Rs 86,000 crore) in 2011-12 to $9 billion (Rs 58,000 crore) in 2015-16. Apart from cotton, copper, petroleum and industrial machinery, India does not export much to China. This means that India buys six times the merchandise it sells to China.
Cellphones, laptops, solar cells, fertilisers, keyboards, displays and communication equipment , including earphones , these are India’s chief imports from China, according to analysis of Ministry of Commerce data.
Other major imports from China include tuberculosis and leprosy drugs, antibiotics, children’s toys, industrial springs, ball bearings, LCD and LED displays, routers, TV remote controllers and set top boxes.
Despite this, political leaders, including Sharad Yadav of Janata Dal (United) from Bihar, Himanta Biswa Sarma, the newly-inducted Finance Minister of Assam, and Anil Vij, Health Minister of Haryana, are appealing for a boycott of “Made in China” goods.
China moved forward with rapid market reforms from the 1980s, propelled by the establishment of special economic zones. Land and labour reforms helped it ramp up its production capacity. The result is that India’s iron, steel and fertiliser production is a 10th of China’s.