This comes amid Prime Minister Narendra Modi’s call for 'Vocal for Local' and 'Atmanirbhar Bharat' to reduce imports of goods and boost domestic manufacturing and employment.
The border conflict between India and China is reflecting on consumer sentiments towards Chinese goods. This comes amid Prime Minister Narendra Modi’s call for ‘Vocal for Local’ and ‘Atmanirbhar Bharat’ to reduce imports of goods and boost domestic manufacturing and employment. According to a LocalCircles survey, having more than 32,000 responses from citizens across 235 districts in India, a whopping 87 per cent said that they are willing to boycott the purchase of all Chinese goods for the next one year. However, China’s penetration into India is deep. China’s share in India’s total exports stood at 3.7 per cent while its share in India’s overall imports was 16 per cent, according to a PHD Chamber report.
Moreover, with respect to India’s technology ecosystem, Chinese technology investors have invested around $4 billion in Indian startups in five years ending March 2020, according to a report by Gateway House: Indian Council on Global Relations. 18 unicorns loss-making business model in India including Bigbasket, Byju’s, Flipkart, Ola, OYO, Paytm, Zomato, Swiggy, Snapdeal, Udaan, Rivigo, Quikr, PolicyBazar, MakeMyTrip, Dream11, Hike, Delhivery, and Byju’s have money from Chinese investors such as Alibaba, Tencent, Fosun, Steadview Capital, DiDi Chuxing, Shunwei Capital. Also China-based or China-linked apps and companies like TikTok, Shareit, UC Browser, Zoom Oppo, Xiaomi etc. have topped when it comes to consumer demand.
Nonetheless, 97 per cent respondents said that they will boycott buying major Chinese brands including Xiaomi, Oppo, Vivo etc while 39 per cent said they will use what they have but won’t buy new products. Clearly, there is anger amid consumers against China and as a result, they believe that a 200 per cent import duty should be imposed on products that are made in China similar to Pakistan. While 42 per cent asked for import duty hike on all products, 36 per cent said the exemption should be made on raw material supplies. India had imposed a 200 per cent import duty on all products import from Pakistan after the February 2019 Pulwama attack.
India had recently tweaked its FDI policy to check investments from China under the automatic route. This came after China’s central bank People’s Bank of China acquired 1.75 crore shares in India’s HDFC Bank. According to a PTI report, the Finance Ministry has now proposed restrictions on foreign investment in pension funds from India’s bordering countries. “A government approval would be required for the investing entity or individual from any of the bordering countries including China. The relevant provisions of FDI policy issued from time to time would apply in all such cases,” according to a draft notification circulated for comments.