People Abandon Chinese Products
Post URI terror attack Indians have become more patriotic than ever. China the mostly friendly country to our enemy is in the receiving end after they ended up supporting Pakistan terror mastermind Massod Azhar . People started venting anger on China for supporting Pakistan’s heinous crimes. Many of the stories to ban Chinese products in India went viral on web.
Many of my friends wanted to avoid buying Chinese products and I can see that larger population is in the same mood. China tops the Indian import list accounting to more than 10.7% of total imports, Majority of them are electronics. China has become manufacturing hub for the world and also a reason behind the economic dominance in the last decade.
Worlds largest Electronic manufacturing companies depend on china for either Manufacturing or assembling their components. In fact Apple’s iphone is also manufactured in china and shipped globally. The main reason being the lower cost of manufacturing and cheap labor considering world most populated country.
In fact I personally used to import various component from china to create products. One thing I can guarantee that no one can manufacture the products at the cost of Chinese . It gives me the advantage of launching products in India at a lower cost considering the price sensitive purchase behavior. Another major reason for Chinese import is India’s weakness in hardware and electronic component manufacturing. The same product when imported from US or Europe costs me more than 10 times and economically it is not viable.
Currently there is some definite impact on Chinese goods purchase but I think this will fade away after sometime once the wound starts healing. If we are envisioning a country where there is zero import from china then we have to build our manufacturing capabilities.
Impact of Made In India
Prime Minister Modi’s ambitions mission to beat china with “Make in India” is shaping well, but we are decades away from beating china. Look at the scenario of mobile phone market, all the Indian brands like Micromax, Lava,Cellkon, Iball, Intex etc import the components from china and just assemble there here before selling. Except minor design components everything else is Chinese.
Now do you call these companies Indian? Will you stop buying from them?
Despite the fact that we want to avoid Chinese goods, Indirectly we are supporting them. Made in India mission will only be successful if we are able to build R&D capabilities and accelerate innovations. In this current scenario I consider India as a good trading country but not a manufacturing country. In this last decade can we identify one innovation which is from India and selling around the globe?
We are good at exporting software, Agriculture goods, Milk products etc but not innovations. The mission made in India will be possible only when governments supports entrepreneurship big time. Just a notion called “Startup India – Startup India” will not change much unless there is a real action around it. Read Startup India qualifies only one startup.
Investors should have higher risk appetite and invest in hardware startups and not just eCommerce, Entrepreneurs instead just building a replica business models and launching a website or app should focus on solving real world problems and build innovations that can be used at a global scale. This is when the game starts changing and we will not be very far from becoming a big global economy. Till then enjoy the mission “Ban Made In China”
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