Is it really possible to boycott Chinese product in India?

 Is it really possible to boycott Chinese products in India?

                                                        

                                      

When the world struggles to deal with the impending threat of the deadly coronavirus pandemic, Chinese and Indian troops seem to be heading towards a face-off along the Line of Actual Control or LAC. Both countries have sent troops to the border and aggression seems to be on the rise. At a time when border tensions between India and China have escalated on the Ladakh frontier, there has been an upwelling in nationalist sentiments in media in both countries. In India, these sentiments have additionally found expression in a growing consumer movement for the boycott of Chinese products and services..

A few days ago, Sonam Wangchuk, a social worker posted a video on youtube, saying that Indians should boycott everything Chinese to take revenge for rising tensions between India and China. Wangchuk believes that the only way to defeat China is by using "wallet power." In the video, he says that while our soldiers are fighting Chinese troops on the border, we are buying Chinese products and goods which in turn gives China more money to invest in their army. Soon after Wangchuk's video went viral, #BoycottChina, #BoycottMadeinChina, #BoycottChineseApps and #BoycottTiktok began trending on social media. Bollywood actor Milind Soman also joined the bandwagon and decided to uninstall Chinese app Tiktok from his phone.

                                

But does a campaign for the economic boycott of a country have any stong hope of success, and is it even a reasonable chance? We live in a world which, despite many recent setbacks to globalization, is inextricably interlinked, with the supply chains of companies spanning various geographies. Products made by Indian firms contain components that come from China or use Chinese machinery to make them. Small and medium businesses, the focus of attention currently for their fragility in the face of pandemic-induced lockdowns, extensively use low-cost Chinese machinery and capital goods, besides trading in many finished products from that country. Large Indian companies like Dr. Reddy’s Laboratories, Mahindra & Mahindra and Sundram Fasteners have manufacturing units in China that cater to markets abroad as well as in India. In several segments, the fate of an entire industry could be in jeopardy if its China links are severed. Commentators have also pointed out how any such call to boycott Chinese goods sits uncomfortably with the billions of dollars of Chinese investment in local start-ups that are routinely held up as role models of Indian innovation.

Sure, India is a large market for Chinese goods, accounting for 3% of China’s exports and adding up to $75 billion in 2019. But here’s the thing: India’s $17 billion of exports to China account for a much-higher 5.3% of our total exports. Any trade war with China would hurt India, too.

It is a matter of fact that the call for a boycott of Chinese goods did not come in response to the covid-19 pandemic, which is widely believed to have started in China, even if it wasn’t actually manufactured there in a lab. This leads to the general theory that most such boycotts are related to non-trade issues that are almost always geopolitical in nature. Sensibly, India’s Defence Minister Rajnath Singh has been stressing the need to resolve the border issue through dialogue. After all, India has border disputes as well as other issues with several countries. Shunning their products or services is not an answer. Instead of boycotting Chinese goods, we should negotiate with Beijing to open China’s market further to Indian services as well as more finished goods. That would help us raise our exports.

The bottom line, therefore, is that Indian companies need to work harder before they can compete with the Chinese. The government also needs to chip in by providing better infrastructure and by reducing the rate at which loans are given to Indian corporations. Only when the gap between India and China is narrowed, can India boycott Chinese goods. If such a boycott is done now, it will hurt Indian interests more.