Sumanth Samsani: boycotting Chinese goods has been a flop.

rockdog

Senior Member
Joined
Dec 29, 2010
Messages
1,102
Likes
567
Country flag
India-China economic ties: Impact of Galwan


The current trade scenario suggests that the nationalistic notions of bringing China to its knees — by boycotting Chinese goods — has been a flop.

In recent years, the India-China bilateral relationship has been characterised by historical animosities and border disputes. Nevertheless, the economic ties have grown since the early 2000s and have been at the forefront of this relationship. Trade and investment have provided a cushion to this otherwise tricky relationship.


China forms an integral part of the global supply chain, and India too is heavily dependent on Chinese imports, ranging from a variety of raw materials to critical components.



The bilateral trade that stood at US$ 3 billion in the year 2000 grew to US$ 92.68 billion in 2019. China was India’s second-largest trading partner in 2019 and emerged as the largest trading partner in the first half of FY 20-21. The bilateral trade declined by only 15% compared to a 32.46% decline in overall trade in 2020-21. China accounted for 5% of India’s exports and 14 % of India’s imports in 2019. This had led to a very high trade deficit of US$ 56.77 billion in 2019. Attempts have been made to reduce the India-China trade deficit through bilateral talks. The issue, for instance, was raised at the bilateral informal summit in Mahabalipuram, and both sides agreed to set up a new high level economic and trade dialogue mechanism to address this issue.


China forms an integral part of the global supply chain, and India too is heavily dependent on Chinese imports, ranging from a variety of raw materials to critical components. According to data from 2019, a staggering 70% of electronic components, 45% of consumer durables, 70% of Active Pharmaceutical Ingredients (APIs), and 40% of leather goods come from China. According to a response to a query in Rajya Sabha, India has the world’s third-largest pharmaceutical industry for which 2/3rds of its key ingredients come from China.

Lockdown in China led the trade to fall by about 12.4% to US$ 12 billion in 2020 for the first two months of the year compared to the same time period in 2019. The imports fell to record lows of US$ 3.2 billion both in April and May, the period of lockdown in India. Meanwhile, the Galwan Valley incident in mid-June led to calls for boycotting of Chinese goods. According to a survey conducted by Local Circles, 87% of Indian consumers were willing to boycott Chinese goods. One of the prime campaigns was to boycott Chinese goods for Diwali and it was seen that even in the Prime Minister’s home state of Gujarat in Ahmedabad, 80% of the decorative lights and LEDs sold in shops were still ‘Made in China.’ In July, Chinese imports increased to US$ 5.6 billion, to almost pre-lockdown levels.

China’s share in India’s import basket has increased to 18.11% in the April-August period. The recovery of imports in July was led by organic chemicals, electrical machinery and equipment, pharmaceutical products, and medical equipment. The monthly trade of organic chemicals, electrical machinery, boilers, and machinery in September reached levels comparable to those from the previous year. Pharmaceutical product imports hit a record high this year at US$ 30.12 million in July showing a record growth of 50.32% compared to the previous year leading the Chinese exports to India. Various sectors including surgical or medical instruments have shown growth.

Mineral ores, mineral byproducts, organic chemicals among others formed the bulk of the exports from India to China in 2019-20. Exports to China have surged this year even after the Galwan Valley clash. Exports to China grew at a rate of 26.19% compared to a decrease in overall exports at 21.13% in 2020. Organic chemicals is one of the sectors where China has a 15% market share worth US$ 1.34 billion in the Indian exports. The exports of plastics to China from India have also increased by 71.8% to US$ 751.58 million from US$ 437.47 million. But this significant growth in exports to China has been led by a big increase in exports of iron and steel, with total exports to China at US$ 2.147 billion in Jan-Sept 2020, up from US$ 348.35 million in the same period last year. China’s share in the total exports stands at 9.1% in the April-August period up from 5.3% in 2019-2020.


Post-pandemic, China’s economy has managed to get back on track with a positive growth rate. This growth in domestic demand has led to this exponential growth in exports of iron and steel from India. One major difference that has been noticed is that Indian exports in this sector have moved away from raw material like ores to finished and semi-finished goods, highlighting the increased global competitiveness of Indian companies. China constituted around 90% of the Indian iron ore exports worth US$ 1.92 billion in the April-September period of 2020 with an 83.91% growth year on year.

Effect of the Galwan Valley incident

There has also been an effort to reduce India’s dependence on Chinese goods. The Indian Railways, for instance, cancelled an INR 471 Crore deal with a Chinese firm. Similarly, state-owned telecom firm BSNL was instructed not to use gear from Chinese firm Huawei for a network upgrade. The government has mandated all products to have the Country of Origin tag for products on the Government e-Marketplace in an effort to identify Chinese-origin goods. In early July 2020, the Ministry of Power restricted power supply systems and networks import from China citing cyber and security threats, which constitute about 30% of the total imports from China. In the last 10 years, 12,540 MW out of 22,420 MW of the supercritical power plants were built using Chinese equipment. India also extended safeguard taxes on imports of solar cells and modules as well as imposed anti-dumping duty on several goods. In July, India placed colour television sets imports under the restricted category, thus requiring a licence to import; and air conditioners under the prohibited category. The effects of these moves cannot be measured immediately.


But the Indian economy is deeply intertwined with Chinese exports. China’s share in Indian imports for intermediate goods, capital goods, and final consumer goods is 12%, 30%, and 26% respectively. India depends on China in many key industries from electrical machinery and appliances to pharmaceutical drug API. In recent years, there have been certain mobile companies shifting their assembly lines to India, which is a step in the right direction but still, all the key high-end manufacturing components like the display, chipset, and memory are being imported from China. India has banned key imports in the electrical machinery sector citing the availability of technology in India but what needs to be seen is how competitive it is, quality and cost-wise.


India depends on China in many key industries from electrical machinery and appliances to pharmaceutical drug API.



Cost is a vital reason why Chinese products dominate markets across sectors. Products such as fertilisers are 76% cheaper, electronic circuits 23%, and data processing units around 10% cheaper if made in China. It will be hard to substitute or compete with those prices. Since the pandemic, there are calls to diversify the supply chain. The Indo-American Chamber of Commerce said that around 1,000 firms were planning to leave China but only 300 of them were serious about investing in India.


The current trade scenario suggests that the nationalistic notions of bringing China to its knees by boycotting Chinese goods has been a flop. The simple example that even a good as small as LEDs are still cheaper than Indian alternatives by almost 50% despite a 40% hike in prices of the Chinese goods is indicative of that. This indicates that India needs to undertake a series of reforms like land and labour reforms to foster growth and investment. India also needs to scale up domestic production in key sectors including electrical machinery and pharmaceuticals to replace those imports. Without any of these key reforms, the Prime Minister’s call for ‘Aatma Nirbhar Bharat’ will remain a mere slogan as it currently appears to be now and that is why we see a booming trade relationship between India and China after the Galwan Valley incident and will continue to see a significant dependence on China for the foreseeable future.
 

Haldilal

लड़ते लड़ते जीना है, लड़ते लड़ते मरना है
Senior Member
Joined
Aug 10, 2020
Messages
6,677
Likes
21,031
Country flag
Ya'll Nibbiars The India-China bilateral trade in 2020 decreased by 5.64% Y-o-Y and stood at USD 87.65 billion compared to USD 92.89 billion in 2019, according to Union Commerce Ministry's recent data on India-China trade in 2020. Notably, Indian imports from China also dropped by 10.87% and stood at USD 66.78 billion compared to USD 74.92 billion in 2019.

"Good signs that Indian exports to China increased by 16.15% from USD 17.896 billion to reach USD 20.87 billion in 2020. This is the highest level ever for Indian exports to China and the first time they have crossed USD 20 billion," said the ministry.

Accordingly, the trade deficit with China has declined by 19.39% from USD 56.95 billion in 2019 to USD 45.91 billion
 

26/11

Regular Member
Joined
Mar 1, 2015
Messages
431
Likes
1,845
Country flag
Galwan has changed a lot in terms of economic thinking in India. The boycotting Chinese goods was emotional response. Long term strategy is to decrease dependence and phase out imports which were harming our industry. So, the trade will never stop, but China might not get free run as in Past. It will have to re-balance the trade.
 

ladder

Senior Member
Joined
Mar 28, 2013
Messages
5,871
Likes
5,946
Country flag
India-China economic ties: Impact of Galwan


The current trade scenario suggests that the nationalistic notions of bringing China to its knees — by boycotting Chinese goods — has been a flop.

In recent years, the India-China bilateral relationship has been characterised by historical animosities and border disputes. Nevertheless, the economic ties have grown since the early 2000s and have been at the forefront of this relationship. Trade and investment have provided a cushion to this otherwise tricky relationship.


China forms an integral part of the global supply chain, and India too is heavily dependent on Chinese imports, ranging from a variety of raw materials to critical components.




The bilateral trade that stood at US$ 3 billion in the year 2000 grew to US$ 92.68 billion in 2019. China was India’s second-largest trading partner in 2019 and emerged as the largest trading partner in the first half of FY 20-21. The bilateral trade declined by only 15% compared to a 32.46% decline in overall trade in 2020-21. China accounted for 5% of India’s exports and 14 % of India’s imports in 2019. This had led to a very high trade deficit of US$ 56.77 billion in 2019. Attempts have been made to reduce the India-China trade deficit through bilateral talks. The issue, for instance, was raised at the bilateral informal summit in Mahabalipuram, and both sides agreed to set up a new high level economic and trade dialogue mechanism to address this issue.


China forms an integral part of the global supply chain, and India too is heavily dependent on Chinese imports, ranging from a variety of raw materials to critical components. According to data from 2019, a staggering 70% of electronic components, 45% of consumer durables, 70% of Active Pharmaceutical Ingredients (APIs), and 40% of leather goods come from China. According to a response to a query in Rajya Sabha, India has the world’s third-largest pharmaceutical industry for which 2/3rds of its key ingredients come from China.

Lockdown in China led the trade to fall by about 12.4% to US$ 12 billion in 2020 for the first two months of the year compared to the same time period in 2019. The imports fell to record lows of US$ 3.2 billion both in April and May, the period of lockdown in India. Meanwhile, the Galwan Valley incident in mid-June led to calls for boycotting of Chinese goods. According to a survey conducted by Local Circles, 87% of Indian consumers were willing to boycott Chinese goods. One of the prime campaigns was to boycott Chinese goods for Diwali and it was seen that even in the Prime Minister’s home state of Gujarat in Ahmedabad, 80% of the decorative lights and LEDs sold in shops were still ‘Made in China.’ In July, Chinese imports increased to US$ 5.6 billion, to almost pre-lockdown levels.

China’s share in India’s import basket has increased to 18.11% in the April-August period. The recovery of imports in July was led by organic chemicals, electrical machinery and equipment, pharmaceutical products, and medical equipment. The monthly trade of organic chemicals, electrical machinery, boilers, and machinery in September reached levels comparable to those from the previous year. Pharmaceutical product imports hit a record high this year at US$ 30.12 million in July showing a record growth of 50.32% compared to the previous year leading the Chinese exports to India. Various sectors including surgical or medical instruments have shown growth.

Mineral ores, mineral byproducts, organic chemicals among others formed the bulk of the exports from India to China in 2019-20. Exports to China have surged this year even after the Galwan Valley clash. Exports to China grew at a rate of 26.19% compared to a decrease in overall exports at 21.13% in 2020. Organic chemicals is one of the sectors where China has a 15% market share worth US$ 1.34 billion in the Indian exports. The exports of plastics to China from India have also increased by 71.8% to US$ 751.58 million from US$ 437.47 million. But this significant growth in exports to China has been led by a big increase in exports of iron and steel, with total exports to China at US$ 2.147 billion in Jan-Sept 2020, up from US$ 348.35 million in the same period last year. China’s share in the total exports stands at 9.1% in the April-August period up from 5.3% in 2019-2020.


Post-pandemic, China’s economy has managed to get back on track with a positive growth rate. This growth in domestic demand has led to this exponential growth in exports of iron and steel from India. One major difference that has been noticed is that Indian exports in this sector have moved away from raw material like ores to finished and semi-finished goods, highlighting the increased global competitiveness of Indian companies. China constituted around 90% of the Indian iron ore exports worth US$ 1.92 billion in the April-September period of 2020 with an 83.91% growth year on year.

Effect of the Galwan Valley incident

There has also been an effort to reduce India’s dependence on Chinese goods. The Indian Railways, for instance, cancelled an INR 471 Crore deal with a Chinese firm. Similarly, state-owned telecom firm BSNL was instructed not to use gear from Chinese firm Huawei for a network upgrade. The government has mandated all products to have the Country of Origin tag for products on the Government e-Marketplace in an effort to identify Chinese-origin goods. In early July 2020, the Ministry of Power restricted power supply systems and networks import from China citing cyber and security threats, which constitute about 30% of the total imports from China. In the last 10 years, 12,540 MW out of 22,420 MW of the supercritical power plants were built using Chinese equipment. India also extended safeguard taxes on imports of solar cells and modules as well as imposed anti-dumping duty on several goods. In July, India placed colour television sets imports under the restricted category, thus requiring a licence to import; and air conditioners under the prohibited category. The effects of these moves cannot be measured immediately.


But the Indian economy is deeply intertwined with Chinese exports. China’s share in Indian imports for intermediate goods, capital goods, and final consumer goods is 12%, 30%, and 26% respectively. India depends on China in many key industries from electrical machinery and appliances to pharmaceutical drug API. In recent years, there have been certain mobile companies shifting their assembly lines to India, which is a step in the right direction but still, all the key high-end manufacturing components like the display, chipset, and memory are being imported from China. India has banned key imports in the electrical machinery sector citing the availability of technology in India but what needs to be seen is how competitive it is, quality and cost-wise.


India depends on China in many key industries from electrical machinery and appliances to pharmaceutical drug API.




Cost is a vital reason why Chinese products dominate markets across sectors. Products such as fertilisers are 76% cheaper, electronic circuits 23%, and data processing units around 10% cheaper if made in China. It will be hard to substitute or compete with those prices. Since the pandemic, there are calls to diversify the supply chain. The Indo-American Chamber of Commerce said that around 1,000 firms were planning to leave China but only 300 of them were serious about investing in India.


The current trade scenario suggests that the nationalistic notions of bringing China to its knees by boycotting Chinese goods has been a flop. The simple example that even a good as small as LEDs are still cheaper than Indian alternatives by almost 50% despite a 40% hike in prices of the Chinese goods is indicative of that. This indicates that India needs to undertake a series of reforms like land and labour reforms to foster growth and investment. India also needs to scale up domestic production in key sectors including electrical machinery and pharmaceuticals to replace those imports. Without any of these key reforms, the Prime Minister’s call for ‘Aatma Nirbhar Bharat’ will remain a mere slogan as it currently appears to be now and that is why we see a booming trade relationship between India and China after the Galwan Valley incident and will continue to see a significant dependence on China for the foreseeable future.
Good find. Can you please do a favor by e-mailing this article to your alleged agent in the White House, cause his subordinates have started fretting over 'atma nirbhar bharat'. A mail from you containing this article would soothe their nerves.
 

sunshine

Regular Member
Joined
Feb 9, 2021
Messages
251
Likes
368
Country flag
In fact, many China scholars are not satisfied with the investment of Chinese enterprises in India.
For example, Shandong Electric Power Construction,In the West, technology is graded in order to obtain high profits for a long time,Will not build the highest technology in the developing country. Shandong Electric Power Construction(SEPCO) has built a large number of advanced power plants to India with the most advanced technology, and at a relatively low price.
There are Chinese enterprises even the most thorough implementation of Indian production, such as many people criticized XIAO MI company, saying that it has become an Indian company. Produced in large quantities in India.
 

no smoking

Senior Member
Joined
Aug 14, 2009
Messages
4,346
Likes
1,027
Country flag
Ya'll Nibbiars The India-China bilateral trade in 2020 decreased by 5.64% Y-o-Y and stood at USD 87.65 billion compared to USD 92.89 billion in 2019, according to Union Commerce Ministry's recent data on India-China trade in 2020. Notably, Indian imports from China also dropped by 10.87% and stood at USD 66.78 billion compared to USD 74.92 billion in 2019.

"Good signs that Indian exports to China increased by 16.15% from USD 17.896 billion to reach USD 20.87 billion in 2020. This is the highest level ever for Indian exports to China and the first time they have crossed USD 20 billion," said the ministry.

Accordingly, the trade deficit with China has declined by 19.39% from USD 56.95 billion in 2019 to USD 45.91 billion
In the meantime, India's total imports (merchandise) declined from 478 billions of 2019 to 367 billions, declining 23%.

In other words, the portion of Chinese imports became larger.
 

Hari Sud

Senior Member
Joined
Mar 31, 2012
Messages
1,871
Likes
2,703
Country flag
Are we fooling ourselves not cutting back on Chinese imports? If not then why so much propaganda to boycott Chinese goods.
 

ladder

Senior Member
Joined
Mar 28, 2013
Messages
5,871
Likes
5,946
Country flag
In the meantime, India's total imports (merchandise) declined from 478 billions of 2019 to 367 billions, declining 23%.

In other words, the portion of Chinese imports became larger.
🤔 Could you please expand, especially the second sentence?
 

rockdog

Senior Member
Joined
Dec 29, 2010
Messages
1,102
Likes
567
Country flag
Galwan has changed a lot in terms of economic thinking in India. The boycotting Chinese goods was emotional response. Long term strategy is to decrease dependence and phase out imports which were harming our industry. So, the trade will never stop, but China might not get free run as in Past. It will have to re-balance the trade.
From the POV of Indian, i think nothing wong. But if the solution is staying away from RCEP will be quit confused to me.

China's leading position on manufacutre to IT tech over India is a systematic outcome, from our trading policy (like OBOR and RCEP, CAI with EU) to our internal industrial subsidies and venture capital system.

I have to say decrease the dependence on China will be a tough road if India just follow the Modi's current choices.
 

rockdog

Senior Member
Joined
Dec 29, 2010
Messages
1,102
Likes
567
Country flag
In fact, many China scholars are not satisfied with the investment of Chinese enterprises in India.
For example, Shandong Electric Power Construction,In the West, technology is graded in order to obtain high profits for a long time,Will not build the highest technology in the developing country. Shandong Electric Power Construction(SEPCO) has built a large number of advanced power plants to India with the most advanced technology, and at a relatively low price.
There are Chinese enterprises even the most thorough implementation of Indian production, such as many people criticized XIAO MI company, saying that it has become an Indian company. Produced in large quantities in India.
Yes, after Galwan conflict, the most disscusion topic about China-India economic tie here is shitting the government not giving enough alarm to those companies invested heavily on India, especially on infrascture field... They are saying if we don't have trust to each other, just selling things there, not to build.
 

Flying Dagger

Senior Member
Joined
Sep 26, 2019
Messages
2,076
Likes
5,026
Country flag
Yes, after Galwan conflict, the most disscusion topic about China-India economic tie here is shitting the government not giving enough alarm to those companies invested heavily on India, especially on infrascture field... They are saying if we don't have trust to each other, just selling things there, not to build.
Absolute rubbish Xiomi merely assemble here to save on cost and get to sell more products under made in india tag which it uses rather shamelessly like a typical chink.

On the contrary companies like Samsung have invested heavily here with large manufacturing plants.

Reliance is also doing its part and many new Indian companies who used to import from China are shifting the manufacturing slowly to India.

What is required now is a total blanket ban if any software optimization by Chinese companies and letting Taiwan and Japan invest in the sector by banning Chinese telecom .

Already by blocking 5g entry of huawei and chinks telecom work has been started.

Also one must not forget the former reliance company which was destroyed by faulty Chinese products and equipments they used which resulted bankruptcy of the company.

China isn't just an enemy of India but of humanity so every strategy must be devised to make sure over next few decades it can be disintegrated into pieces and paid for its crime on people of Tibet, xinxiang etc.
 

rockdog

Senior Member
Joined
Dec 29, 2010
Messages
1,102
Likes
567
Country flag
Absolute rubbish Xiomi merely assemble here to save on cost and get to sell more products under made in india tag which it uses rather shamelessly like a typical chink.

On the contrary companies like Samsung have invested heavily here with large manufacturing plants.

Reliance is also doing its part and many new Indian companies who used to import from China are shifting the manufacturing slowly to India.

What is required now is a total blanket ban if any software optimization by Chinese companies and letting Taiwan and Japan invest in the sector by banning Chinese telecom .

Already by blocking 5g entry of huawei and chinks telecom work has been started.

Also one must not forget the former reliance company which was destroyed by faulty Chinese products and equipments they used which resulted bankruptcy of the company.

China isn't just an enemy of India but of humanity so every strategy must be devised to make sure over next few decades it can be disintegrated into pieces and paid for its crime on people of Tibet, xinxiang etc.
Let me quote the sentence from the article again:
... nationalistic notions of bringing China to its knees — by boycotting Chinese goods — has been a flop ...

 
Joined
Apr 29, 2015
Messages
14,328
Likes
31,292
Country flag
Yes, after Galwan conflict, the most disscusion topic about China-India economic tie here is shitting the government not giving enough alarm to those companies invested heavily on India,
The article posted by you so far hasn't made any real point. It just says Indian production is minute against China (which is a known fact by Indians at first place and that's why government is trying build capacity within India) and is "too difficult road" (as if is not being tried to get through). The efforts were initially called flop in 2014-16 (because they could not dent Chinese imports in past) became fruitful after 2018 and even made China feel the heat.

India is a swiftly growing economy with too high wealth generation rates. It will be only very large size economy and power pole in world besides US & China in next three decades. So it's not just China. A number of countries are investing in India for returns. Indian government isn't pitching for investment from Chinese conglomerates. In fact, it is banning them, people are boycotting them and they are free to go to any other country. They are in a country which sees them as enemies because still this country is a great market.

As far as boycotting China is concerned, China is biggest hindrance in path of India's efforts to make an industrial capacity because it can supply mass replacements to every damn Indian stuff at similar or low costs that even US, Europe and Japan can't do. Simply a conflict and politics is being used here to escape that problem.
India simply wants to become at least a part and competitor of global supply chain in short term before it could supersede China in long term. China's history of economic boom also includes similar measures, opening economy after building industrial capacity.

Statistics reflect that India's economic complexity and types of production are improving. Establishing an advanced ecosystem takes time. There is no real reason so far for which Chinese and pro Chinese Indians are critical about avoiding of Chinese goods and RCEP despite being told about same reasons hundreds of times.
 

Flying Dagger

Senior Member
Joined
Sep 26, 2019
Messages
2,076
Likes
5,026
Country flag
Let me quote the sentence from the article again:
... nationalistic notions of bringing China to its knees — by boycotting Chinese goods — has been a flop ...

Doesn't matter what you quote fact is We have been seeing reduction in import and attitude of people changed towards Chinese products.

It's an another thing now chinks are fooling people with made in Thailand Vietnam hongkong made in india tag.

As soon as authorities start looking into it those importers will.be brought in line too.

Business houses have also shifted to India or are in process. In telecom after seeing how Chinks duped and destroyed a big business house and mobile company Reliance They aren't interested to do business with chinks.

And as I said before a complete ban is also required funding CCP for its ulterior motives should be the last thing to do.

Taiwan and Japan along with Korean companies are working with Indian groups and from 5g to new mobile providers they have started taking charge of market.
 

rockdog

Senior Member
Joined
Dec 29, 2010
Messages
1,102
Likes
567
Country flag
The article posted by you so far hasn't made any real point. It just says Indian production is minute against China (which is a known fact by Indians at first place and that's why government is trying build capacity within India) and is "too difficult road" (as if is not being tried to get through). The efforts were initially called flop in 2014-16 (because they could not dent Chinese imports in past) became fruitful after 2018 and even made China feel the heat.

India is a swiftly growing economy with too high wealth generation rates. It will be only very large size economy and power pole in world besides US & China in next three decades. So it's not just China. A number of countries are investing in India for returns. Indian government isn't pitching for investment from Chinese conglomerates. In fact, it is banning them, people are boycotting them and they are free to go to any other country. They are in a country which sees them as enemies because still this country is a great market.

As far as boycotting China is concerned, China is biggest hindrance in path of India's efforts to make an industrial capacity because it can supply mass replacements to every damn Indian stuff at similar or low costs that even US, Europe and Japan can't do. Simply a conflict and politics is being used here to escape that problem.
India simply wants to become at least a part and competitor of global supply chain in short term before it could supersede China in long term. China's history of economic boom also includes similar measures, opening economy after building industrial capacity.

Statistics reflect that India's economic complexity and types of production are improving. Establishing an advanced ecosystem takes time. There is no real reason so far for which Chinese and pro Chinese Indians are critical about avoiding of Chinese goods and RCEP despite being told about same reasons hundreds of times.
Wel, i quote this article dosen't mean i agree all points from them. Instead, i understand the reason Modi's crackdown on Chinese APPs and setting more barriers to Chinese products. But the way is quite unsophisticated and would even hurt yourself than really hurt China.

Aftert Gulwan conflict, there are so many "retaliations" made by GOI, but have you see any fight back from Chinese government? Almost not, we even increase the import of your steel product and broken rice. We know using the common economic sense to deal with the economic tie, not by bad temper.

Here let me quote (Google translate) some Chinese author's article talk about India-China economic tie:


Li Jianqiu

In today’s increasingly anti-globalization era, neoliberalism is really not a good word. Various media, even myself, have criticized neoliberalism, but if you stand from the perspective of an observer, India actually is really very suitable for neoliberalism.

Although the Indian media has been clamoring for a geopolitical struggle with China, in fact, India is no longer a starting line with China in the most fundamental economic aspect. Vietnam is the most suitable comparison.

During the ten years from 2009 to 2019, Vietnam’s total merchandise exports grew at an average annual rate of 18%, while India’s was only 5%. During this period, Vietnam achieved a trade surplus of US$47 billion, compared with 13 billion in 2010. Obviously, Vietnam’s trade deficit has greatly improved, but India’s trade deficit has soared from US$123.8 billion in 2010 to US$161.8 billion in 2019.

In 2019, Vietnam’s largest exports include motors and equipment (41%), clothing (11%), footwear (8%), and machinery and mechanical equipment (5%). From 2010 to 2019, the highest increase in exports was in motors and equipment, and their share of Vietnam’s total exports rose from 10% in 2010 to 42% in 2019

Among them, mobile phone exports increased the most (with a share of 13%), followed by integrated circuits (7%) and mobile phone parts (6%). The United States, the United Arab Emirates and Austria accounted for 40% of Vietnam's mobile phone exports in 2019.

Compared with Vietnam’s manufacturing and technology-oriented exports, India’s main exports are mainly low-tech products, such as fossil fuels (14%), jewelry, precious metals (11%), machinery (6%), Organic chemicals (5%) and vehicles (5%).

Vietnam’s high-tech exports account for 40% of the manufacturing sector, while India’s 6%.

The reason why Vietnam has achieved such achievements in the electronics industry is mainly attributed to Samsung. In 2018, Samsung Electronics' total sales in Vietnam reached 66 billion U.S. dollars, accounting for 28% of Vietnam's GDP.

The situation in the 2021 fiscal year is not much better in India. Where the new crown epidemic broke out, the Indian media has been optimistic that a large amount of manufacturing will flow from China to India, because only India in the world can undertake such a huge amount of China. In the manufacturing industry, things are counterproductive. According to data from the Ministry of Industry and Internal Trade Promotion of India, FDI inflows fell by US$6.062 billion in the first quarter of fiscal 2021, a 60% drop from 16.329 billion in the same period of the previous fiscal year.

On the contrary, Vietnam has become a hot spot for foreign investment. Vietnam's exports have increased by 18%. Among them, the exports of the two major export industries have surged, namely computers and their accessories have increased by 26%, and machinery and their accessories by 63%.

Last year, Sino-Indian relations deteriorated, and India increased the threshold for Chinese investment. In February of this year, the two countries had withdrawn their actual line of control. Within a few days after reaching an agreement, India relaxed its restrictions on Chinese investment. Indian officials have indicated the next few days. During the week, investment in areas not sensitive to national security will be relaxed. If the Chinese investment in the project accounts for less than 20%, it can be passed automatically without government approval.

Rajiv Bajaj, the CEO of Bajaj, a well-known car manufacturer in India, said that India has no choice but to continue doing business with China, otherwise the losses will be even more serious.

What's the problem with India?

As early as May 2020, the Modi government proposed the "India self-sufficiency" policy. On the one hand, it is to solve employment, on the other hand, to promote economic recovery and revitalize the local manufacturing industry. It is also because of this. Modi provides for small, medium and micro enterprises on the one hand. Loans, on the one hand, speed up the relaxation of labor policy regulations, encourage local production and procurement, and engage in import substitution.

In 2020, the Modi government plans to raise tariffs on all Chinese products. These increases include not only general toys, general consumer goods such as household appliances, but also mobile phones, TVs, and products in some key industries, and follow the example of China's previous attraction. The foreign investment policy vigorously attracts foreign investment.

In April 2020 alone, the Indian government has contacted 1,000 American multinational companies, and Modi has even planned up to 460,000 hectares of land specifically to undertake foreign manufacturing companies withdrawing from China.

Obviously, Modi miscalculated.

Since the Bharatiya Janata Party came to power, although Modi said that he would promote liberalization and market-oriented reforms, he also made a generous statement at the 2018 Davos Forum, saying that “protectionism” and “reverse globalization” are like terror. It’s as dangerous as it is, but what Modi does is protectionism.

Since the reorganization of the Bharatiya Janata Party in 1980, the Indian Party has taken Gandhi Socialism and Swadsi as its economic guiding ideology. Gandhi Socialism highly emphasizes the tradition of small producers with their own division of labor and self-sufficiency, while Swadsi advocates The combination of self-production and purchase of domestic products forms an economic concept with Indian characteristics.

Swadesi believes that the main driving force in India is domestic capital, domestic entrepreneurs and peasant workers, and the role of foreign investment is limited. India should liberalize at home but engage in protectionism abroad.

In China, "reform" and "opening up" go hand in hand. If a person holds the idea of reform, he must have an open mind, but not in India. The two words of reform and openness are separate. India can engage in economic freedom. Confucianism can also be liberalized, but it cannot be opened to the outside world.

In addition, India has a need to protect the local market: small and medium-sized industries and commerce in cities and towns are the traditional bill warehouses of the Bharatiya Janata Party. The currency scrap movement and the goods and services tax have seriously harmed the interests of small and medium-sized industrial and commercial businesses. Modi launched in 2018 to expand the retail industry. Opening to the outside world has also aroused the resentment of small and medium-sized industrial and commercial people. The All India Traders Association, which represents its interests, has continuously held demonstrations throughout the country, forcing the Bharatiya Janata Party to introduce new regulations restricting foreign investment in 2019.

The second is large consortia like Tata and Reliance Industries.

Modi has a very close relationship with Reliance Industries, Adani and other consortia. The Bharatiya Janata Party has accepted large donations from large consortia. 92% of Bharatiya Janata’s funds come from these consortia, which are unwilling to open up the domestic market. , Often lobby the government for protective measures against foreign investment.

During the epidemic, India’s GDP plummeted, but India’s richest man and CEO of Reliance Industries, Ambani, increased his wealth and became the richest person in Asia.

At the same time, because the Indian oil refining industry is dominated by Reliance Industries' Ambani, it has no competitors at all. When oil prices are high, Indian gasoline prices are high, and when oil prices are low, Indian gasoline prices are higher.

Indian gasoline has soared to 8.664 (today's exchange rate), diesel 7.865. The skyrocketing oil price is the core topic of discussion in India. The Minister of Petroleum of India said that high oil prices have hindered India's economic recovery.

As there is no label for Indian gasoline, compared with diesel, the current price of diesel in Wuhan is 5.99.

But looking at the distance between India and the Persian Gulf, which is much closer than China, Ambani has no bottom line in making money.

Even so, in the entire Indian media and in the comment area of the Indian media, you can see voices praising Ambani, claiming that Ambani brings jobs to the Indian people and that Ambani is the pride of the Indians. , I don’t know if it was the navy invited by Ambani.

Downward Indian Economy

Since September 2018, bad debt problems in the Indian banking industry and shadow banking problems have been concentrated. The Indian economy has braked sharply and it can be seen that the growth rate has dropped from 8% in 2015 to 4.2%. During the new crown period, in 2020 From April to June, GDP fell by 23.9% year-on-year, the largest drop since 1996. It was only from October to December last year that India’s economy grew slightly by 0.4%.

India has long used domestic consumption as the main growth force. The problem is that for a poor country like India, domestic consumption power is limited, and from the perspective of the successful economic model after World War II, it is without exception that it adopts export promotion methods. The success of the East Asian economy proves this point. It calls on the people to buy only Indian goods by "self-reliance". As long as industrial capital enters and does not want to import goods, this model is bound to be unsustainable.

For example, India has been hoping to reduce imports from China and continuously increase tariffs on China. The problem is that China not only provides consumer goods to India, but also provides raw materials for India’s production. India makes 70% of raw materials and 25% of auto parts. , 90% of mobile phone parts and 80% of textile threads are provided by China. Cutting off trade with China directly affects local Indian manufacturers, and local manufacturers are forced to find more expensive alternatives, which in turn leads to rising prices. Cause economic chaos.

In the propaganda of "withdrawing from China", India believed it was true, thinking that foreign manufacturers in China would relocate to India collectively with Modi’s call. What he had not thought about was: as the world’s factory, China’s supply chain is resilient, Its scale is completely unimaginable by Indians.

Many manufacturers choose Vietnam instead of India. The main reason is that Vietnam is currently trading with China normally. Vietnam is also a member of RCEP. Manufacturers who relocate to Vietnam can take advantage of Vietnam’s lower labor costs without supplying them. Chain worry. And once relocating to India, it is tantamount to overturning everything.

In addition, Vietnam’s many industrial policies in China are pixel-level plagiarism. On the one hand, plagiarism avoids making policy mistakes. On the other hand, because manufacturers are already familiar with China’s policies and Vietnam’s copying of Chinese policies, manufacturers greatly save their understanding of the Vietnamese production environment Time has multiple benefits for manufacturers.

Of course, it is not realistic to expect India to copy China’s industrial policies. The political environment between China and Vietnam is relatively similar. What Vietnam can do, India cannot do. India is a federal country and cannot form a strong central government. Proof.

At present, 58% of the Indian population are farmers. India’s biggest task at the moment is not to engage in high technology, but to transfer 58% of the population to cities as soon as possible, from farmers to industrial workers, the so-called transfer from China. The "sweatshops" of India are precisely what India lacks now.

India must create an annual growth rate of close to 10% in order to create new jobs for 12 million new labor force each year. India’s current unemployment rate is 6.9%. As a developing country, the unemployment rate is very high, and the unemployment rate is not high. Unbalanced, 26.4% in Haryana, 25.6% in Rajasthan, and 21.1% in Goa. High unemployment inevitably means political instability.

With its self-sufficient Indian economy, for the time being, it is simply unable to come up with huge industrial capital to support this. India needs foreign capital and more capital from China. Because China’s capital in the past was real industrial capital, while American capital was financial capital.

Those "old technologies", "polluting industries", and "sweatshops" that have been dismissed in China are exactly what India is most urgently needed now. Only these companies can bring jobs to India. India's development requires a generation of sacrifices and struggles for it.

Every once in a while, due to the rising labor costs of major manufacturing countries, low-end manufacturing will inevitably flow out, and the world's manufacturing industry chain will be reorganized. This is the best time to take over, and once it is missed, We have to wait for the next revival, and the next revival may be far away.

The last thing India should do is to engage with China at this point in time.
 
Last edited:

Flying Dagger

Senior Member
Joined
Sep 26, 2019
Messages
2,076
Likes
5,026
Country flag
Wel, i quote this article dosen't mean i agree all points from them. Instead, i understand the reason Modi's crackdown on Chinese APPs and setting more barriers to Chinese products. But the way is quite unsophisticated and would even hurt yourself than really hurt China.

Aftert Gulwan conflict, there are so many "retaliations" made by GOI, but have you see any fight back from Chinese government? Almost not, we even increase the import of your steel product and broken rice. We know using the common economic sense to deal with the economic tie, not by bad temper.

Here let me quote (Google translate) some Chinese author's article talk about India-China economic tie:


Li Jianqiu

In today’s increasingly anti-globalization era, neoliberalism is really not a good word. Various media, even myself, have criticized neoliberalism, but if you stand from the perspective of an observer, India actually is really very suitable for neoliberalism.

Although the Indian media has been clamoring for a geopolitical struggle with China, in fact, India is no longer a starting line with China in the most fundamental economic aspect. Vietnam is the most suitable comparison.

During the ten years from 2009 to 2019, Vietnam’s total merchandise exports grew at an average annual rate of 18%, while India’s was only 5%. During this period, Vietnam achieved a trade surplus of US$47 billion, compared with 13 billion in 2010. Obviously, Vietnam’s trade deficit has greatly improved, but India’s trade deficit has soared from US$123.8 billion in 2010 to US$161.8 billion in 2019.

In 2019, Vietnam’s largest exports include motors and equipment (41%), clothing (11%), footwear (8%), and machinery and mechanical equipment (5%). From 2010 to 2019, the highest increase in exports was in motors and equipment, and their share of Vietnam’s total exports rose from 10% in 2010 to 42% in 2019

Among them, mobile phone exports increased the most (with a share of 13%), followed by integrated circuits (7%) and mobile phone parts (6%). The United States, the United Arab Emirates and Austria accounted for 40% of Vietnam's mobile phone exports in 2019.

Compared with Vietnam’s manufacturing and technology-oriented exports, India’s main exports are mainly low-tech products, such as fossil fuels (14%), jewelry, precious metals (11%), machinery (6%), Organic chemicals (5%) and vehicles (5%).

Vietnam’s high-tech exports account for 40% of the manufacturing sector, while India’s 6%.

The reason why Vietnam has achieved such achievements in the electronics industry is mainly attributed to Samsung. In 2018, Samsung Electronics' total sales in Vietnam reached 66 billion U.S. dollars, accounting for 28% of Vietnam's GDP.

The situation in the 2021 fiscal year is not much better in India. Where the new crown epidemic broke out, the Indian media has been optimistic that a large amount of manufacturing will flow from China to India, because only India in the world can undertake such a huge amount of China. In the manufacturing industry, things are counterproductive. According to data from the Ministry of Industry and Internal Trade Promotion of India, FDI inflows fell by US$6.062 billion in the first quarter of fiscal 2021, a 60% drop from 16.329 billion in the same period of the previous fiscal year.

On the contrary, Vietnam has become a hot spot for foreign investment. Vietnam's exports have increased by 18%. Among them, the exports of the two major export industries have surged, namely computers and their accessories have increased by 26%, and machinery and their accessories by 63%.

Last year, Sino-Indian relations deteriorated, and India increased the threshold for Chinese investment. In February of this year, the two countries had withdrawn their actual line of control. Within a few days after reaching an agreement, India relaxed its restrictions on Chinese investment. Indian officials have indicated the next few days. During the week, investment in areas not sensitive to national security will be relaxed. If the Chinese investment in the project accounts for less than 20%, it can be passed automatically without government approval.

Rajiv Bajaj, the CEO of Bajaj, a well-known car manufacturer in India, said that India has no choice but to continue doing business with China, otherwise the losses will be even more serious.

What's the problem with India?

As early as May 2020, the Modi government proposed the "India self-sufficiency" policy. On the one hand, it is to solve employment, on the other hand, to promote economic recovery and revitalize the local manufacturing industry. It is also because of this. Modi provides for small, medium and micro enterprises on the one hand. Loans, on the one hand, speed up the relaxation of labor policy regulations, encourage local production and procurement, and engage in import substitution.

In 2020, the Modi government plans to raise tariffs on all Chinese products. These increases include not only general toys, general consumer goods such as household appliances, but also mobile phones, TVs, and products in some key industries, and follow the example of China's previous attraction. The foreign investment policy vigorously attracts foreign investment.

In April 2020 alone, the Indian government has contacted 1,000 American multinational companies, and Modi has even planned up to 460,000 hectares of land specifically to undertake foreign manufacturing companies withdrawing from China.

Obviously, Modi miscalculated.

Since the Bharatiya Janata Party came to power, although Modi said that he would promote liberalization and market-oriented reforms, he also made a generous statement at the 2018 Davos Forum, saying that “protectionism” and “reverse globalization” are like terror. It’s as dangerous as it is, but what Modi does is protectionism.

Since the reorganization of the Bharatiya Janata Party in 1980, the Indian Party has taken Gandhi Socialism and Swadsi as its economic guiding ideology. Gandhi Socialism highly emphasizes the tradition of small producers with their own division of labor and self-sufficiency, while Swadsi advocates The combination of self-production and purchase of domestic products forms an economic concept with Indian characteristics.

Swadesi believes that the main driving force in India is domestic capital, domestic entrepreneurs and peasant workers, and the role of foreign investment is limited. India should liberalize at home but engage in protectionism abroad.

In China, "reform" and "opening up" go hand in hand. If a person holds the idea of reform, he must have an open mind, but not in India. The two words of reform and openness are separate. India can engage in economic freedom. Confucianism can also be liberalized, but it cannot be opened to the outside world.

In addition, India has a need to protect the local market: small and medium-sized industries and commerce in cities and towns are the traditional bill warehouses of the Bharatiya Janata Party. The currency scrap movement and the goods and services tax have seriously harmed the interests of small and medium-sized industrial and commercial businesses. Modi launched in 2018 to expand the retail industry. Opening to the outside world has also aroused the resentment of small and medium-sized industrial and commercial people. The All India Traders Association, which represents its interests, has continuously held demonstrations throughout the country, forcing the Bharatiya Janata Party to introduce new regulations restricting foreign investment in 2019.

The second is large consortia like Tata and Reliance Industries.

Modi has a very close relationship with Reliance Industries, Adani and other consortia. The Bharatiya Janata Party has accepted large donations from large consortia. 92% of Bharatiya Janata’s funds come from these consortia, which are unwilling to open up the domestic market. , Often lobby the government for protective measures against foreign investment.

During the epidemic, India’s GDP plummeted, but India’s richest man and CEO of Reliance Industries, Ambani, increased his wealth and became the richest person in Asia.

At the same time, because the Indian oil refining industry is dominated by Reliance Industries' Ambani, it has no competitors at all. When oil prices are high, Indian gasoline prices are high, and when oil prices are low, Indian gasoline prices are higher.

Indian gasoline has soared to 8.664 (today's exchange rate), diesel 7.865. The skyrocketing oil price is the core topic of discussion in India. The Minister of Petroleum of India said that high oil prices have hindered India's economic recovery.

As there is no label for Indian gasoline, compared with diesel, the current price of diesel in Wuhan is 5.99.

But looking at the distance between India and the Persian Gulf, which is much closer than China, Ambani has no bottom line in making money.

Even so, in the entire Indian media and in the comment area of the Indian media, you can see voices praising Ambani, claiming that Ambani brings jobs to the Indian people and that Ambani is the pride of the Indians. , I don’t know if it was the navy invited by Ambani.

Downward Indian Economy

Since September 2018, bad debt problems in the Indian banking industry and shadow banking problems have been concentrated. The Indian economy has braked sharply and it can be seen that the growth rate has dropped from 8% in 2015 to 4.2%. During the new crown period, in 2020 From April to June, GDP fell by 23.9% year-on-year, the largest drop since 1996. It was only from October to December last year that India’s economy grew slightly by 0.4%.

India has long used domestic consumption as the main growth force. The problem is that for a poor country like India, domestic consumption power is limited, and from the perspective of the successful economic model after World War II, it is without exception that it adopts export promotion methods. The success of the East Asian economy proves this point. It calls on the people to buy only Indian goods by "self-reliance". As long as industrial capital enters and does not want to import goods, this model is bound to be unsustainable.

For example, India has been hoping to reduce imports from China and continuously increase tariffs on China. The problem is that China not only provides consumer goods to India, but also provides raw materials for India’s production. India makes 70% of raw materials and 25% of auto parts. , 90% of mobile phone parts and 80% of textile threads are provided by China. Cutting off trade with China directly affects local Indian manufacturers, and local manufacturers are forced to find more expensive alternatives, which in turn leads to rising prices. Cause economic chaos.

In the propaganda of "withdrawing from China", India believed it was true, thinking that foreign manufacturers in China would relocate to India collectively with Modi’s call. What he had not thought about was: as the world’s factory, China’s supply chain is resilient, Its scale is completely unimaginable by Indians.

Many manufacturers choose Vietnam instead of India. The main reason is that Vietnam is currently trading with China normally. Vietnam is also a member of RCEP. Manufacturers who relocate to Vietnam can take advantage of Vietnam’s lower labor costs without supplying them. Chain worry. And once relocating to India, it is tantamount to overturning everything.

In addition, Vietnam’s many industrial policies in China are pixel-level plagiarism. On the one hand, plagiarism avoids making policy mistakes. On the other hand, because manufacturers are already familiar with China’s policies and Vietnam’s copying of Chinese policies, manufacturers greatly save their understanding of the Vietnamese production environment Time has multiple benefits for manufacturers.

Of course, it is not realistic to expect India to copy China’s industrial policies. The political environment between China and Vietnam is relatively similar. What Vietnam can do, India cannot do. India is a federal country and cannot form a strong central government. Proof.

At present, 58% of the Indian population are farmers. India’s biggest task at the moment is not to engage in high technology, but to transfer 58% of the population to cities as soon as possible, from farmers to industrial workers, the so-called transfer from China. The "sweatshops" of India are precisely what India lacks now.

India must create an annual growth rate of close to 10% in order to create new jobs for 12 million new labor force each year. India’s current unemployment rate is 6.9%. As a developing country, the unemployment rate is very high, and the unemployment rate is not high. Unbalanced, 26.4% in Haryana, 25.6% in Rajasthan, and 21.1% in Goa. High unemployment inevitably means political instability.

With its self-sufficient Indian economy, for the time being, it is simply unable to come up with huge industrial capital to support this. India needs foreign capital and more capital from China. Because China’s capital in the past was real industrial capital, while American capital was financial capital.

Those "old technologies", "polluting industries", and "sweatshops" that have been dismissed in China are exactly what India is most urgently needed now. Only these companies can bring jobs to India. India's development requires a generation of sacrifices and struggles for it.

Every once in a while, due to the rising labor costs of major manufacturing countries, low-end manufacturing will inevitably flow out, and the world's manufacturing industry chain will be reorganized. This is the best time to take over, and once it is missed, We have to wait for the next revival, and the next revival may be far away.

The last thing India should do is to engage with China at this point in time.
You needed Indian iron for your infra projects as well rice to feed your people.

And India is trying to become manufacturing hub of electronic products so it is totally justified in banning Chinese products. Infact the trade imbalance suggest the dumped goods from China must be banned outright.
 

no smoking

Senior Member
Joined
Aug 14, 2009
Messages
4,346
Likes
1,027
Country flag
You needed Indian iron for your infra projects as well rice to feed your people.
Not at all.

In 2019, India exported 13.5% of her iron core, of which 74.6% went to China. However, Indian iron core only counted 2.2% of total iron core that Chinese imported in 2019.

On the hand, for every ton of iron core India exported to China, Indian producers earn $70 dollars more than the price paid Indian domestic steel makers. That is why Indian government impose 30% of export duty. Otherwise, the export portion would be much higher.

So, it is not Chinese relying on Indian iron core but India relies on China to feed those employees in India iron core producers.

Regarding rice that India exported to China, in 2019, the total value of trade was only USD $434K , all together 748 tones. almost like nothing.
 

rockdog

Senior Member
Joined
Dec 29, 2010
Messages
1,102
Likes
567
Country flag
You needed Indian iron for your infra projects as well rice to feed your people.
Broken rice is good for making snacks and noodle;

* China buys 100,000 T broken rice at $300 per tonne

* China’s traditional suppliers struggle due to lower crop

* India offers rice at lower price than other Asia suppliers (Adds details, analyst comment)

“China buying rice from India, or U.S. or any country, is just adding some flavor to the domestic market. The trade has very limited impact on the China market,” said Yin Xiuying, analyst with trade website www.ChinaGrain.CN, based in Harbin, capital of China’s northeastern province of Heilongjiang.



Iron core is good for making finished industrial products and export, since export on 2020 are still fast growing.
 
Thread starter Similar threads Forum Replies Date
A.V. Article: A case for boycotting all that is Pakistan Defence & Strategy 0

Latest Replies

Global Defence

New threads

Articles

Top