A quarter of your car, 70% of your TV, 90% of antibiotics come from China
- Indian companies are dependent on imports from China in several key sectors apart from smartphones and smart TVs.
- Products like air conditioners, cars, electric vehicles and even medicines are highly dependent on material from China.
- Even though companies might make many of these products in India, the heavy dependence on Chinese imports could hurt them if the boycott China campaign prevails.
AdvertisementThe dominance of Chinese products in electronics, particularly, smartphones and smart TVs is widely known. But, did you know that even many of the ‘made in India’ products rely on parts imported from China?
These are the top 7 sectors that will be hurt the most if the boycott China campaign prevails:
- Cars – 27% of the imports come from China, including key components used in engines, wheels and electric vehicles. China is the key supplier for sub-components used in engine, electrical, electronics, alloy wheels, tyres etc. Also, it supplies key components for EVs, including lithium-ion battery cells, according to a Motilal Oswal, a broking firm, report.
Also read: Here are the startups fuelling India’s electric vehicle dream
- Consumer durables – Supply chain dependence on China is high for components like compressors, LED lights, motors and mobile displays. Up to 70% of the cost of a smart TV is the display and most of them come from China.
- Pharmaceuticals – 60-70% of key materials come from China and the Chinese raw material is 20-30% cheaper than domestic production.
However, Sun Pharma and Cipla would be the least impacted as they are fully integrated and have considerable exposure to the branded business, Motilal Oswal said.
- Telecom – Airtel and Vodafone Idea use telecom equipment from Huawei and ZTE in a total of 10 circles out of 22. Over 75% of smartphones in India are imported from China.
- Chemical and Agro Chemicals – 10-50% of raw materials are sourced from China depending on the product. Companies are trying to reduce their dependence on China by identifying other countries to source from. Agrochemicals refer to pesticides used by farmers.
- Ecommerce and tech startups – Major ecommerce players and tech startups like Info Edge, Zomato and Paytm have high investment exposure to China. The government has already started enforcing some regulations like asking these companies to label Chinese-origin products.
- Utilities – 80% of India’s solar module imports come from China and some thermal plants also depend on China for equipment.
AdvertisementThese are the market shares of Chinese companies in key product segments
The consumer durables and appliances segment which includes products like air conditioners, smartphones, smart TVs, refrigerators and more is dominated by Chinese companies.
For instance, 28% of all air conditioners in India are imported.
According to data from Counterpoint Research, Xiaomi leads the smart TV category with a 27% market share, more than the cumulative share of Samsung and LG.
In the smartphone category, Chinese companies like Xiaomi, Oppo, Vivo and Realme have an overwhelming presence with a market share of 76%, according to IDC.
Electrical equipment, including smartphones and TVs account for over 22% of India’s imports from China. In the year 2018-19, imports in this category stood at more than $20 billion.
According to data obtained from the Ministry of Commerce and Industry’s Export & Import Data Bank, here are the top three imports from China to India in 2018-19:
|Particulars||India’s imports from China|
|Electrical equipment||$20.63 billion|
|Nuclear reactors||$13.4 billion|
|Organic chemicals||$8.6 billion|
Inside India’s ₹50,000 crore scheme to woo electronics manufacturing including smartphones
The boycott of China’s products will be easier said than done – smartphones, ACs and cars may become more expensive
Finance Minister Nirmala Sitharaman announces six measures for the MSME sector
Popular on BI
- I bought a car wash at 22 years old. It basically runs itself — and I make $5,500 in passive income each month.
- Companies say Elon Musk's plan to charge $1,000 for month for Twitter checkmarks is 'outlandish' and makes them 'meaningless'
- A lawyer who quit to become an OnlyFans performer says she now makes more money and is happier
- NSE, BSE put Adani Green Energy under second stage of longterm ASM framework from Mar 28
- Two multibagger stocks under Nifty500 doubled investors money in last six months
- Disney's first job cut round begins this week, 7,000 employees to be hit: CEO
- Sensex, Nifty50 likely to open in the green amid positive global cues: HDFC, Tata Motors among stocks to watch
- A fifth of Indians feel sleepy at work, future worries keep ‘em awake