The Coronavirus has not only resulted into death of thousands of people but has also hit badly the industry and commerce of China and the pinch of the same is being felt now in trade & commerce of India. The over-dependence on China for finished products, spare parts and raw material will cripple the trade and small Industries in India, if prevented steps are not taken by the Government to carve out alternate measures and bringing out an immediate policy to empower domestic trade & industry to maintain the supply chain.
The scarcity of goods may also result into inflation in prices-said Mr. B.C.Bhatia, National President and Mr. Praveen Khandelwal, Secretary General of the Confederation of All India Traders (CAIT). The CAIT in a communication sent to Union Commerce Minister Mr. Piyush Goyal today has urged him to convene a meeting of trade and Industry immediately to discus the current situation.
Both Mr. Bhartia & Mr. Khandelwal said that India’s trade and Industry is highly dependent upon China for broadly three reasons. We import finished goods which are re-distributed in the Country, raw material which is being used for producing goods and import spare parts used in assembling the goods by traders and small Industries. Since Coronavirus broke out in January, the trade and Industry in China is closed and there is no manufacturing or supply of goods.
Because of the deadly virus, the Indian importers have stopped imports of China and have canceled their visits to China or other coronavirus affected Countries. Generally, the importers keep stocks of these goods as a buffer stock for two months and now the situation has arisen when the supply chain will get affected badly. The situation will become more vulnerable as it appears that even after resuming production in China, it will take months to have regular supplies from China.
India imports hundreds of items from China prominently toys, furniture, builder’s hardware, footwear, clothing fabric, furnishing fabric, consumable goods, FMCG products, gift articles, watches, mobiles, mobile accessories, electronic goods, electrical items, medical and surgical equipments, surgical goods, pharmaceuticals, billets and other long products of Iron & Steel, low cost Air-conditioners, engineering goods, chemicals, construction instruments, Kitchen equipments and accessories, auto spare parts, machinery items, paper, stationery items, fertilizers, plastic and plastic products, fancy decorative items, cosmetics, Computers and computer accessories, Solar Panels, Spares for E-Rickshaw, and even bamboo sticks for making Agarbatti are imported from China. In nutshell, major items being used in daily life are being imported from China.
Both Mr. Bhartia and Mr. Khandelwal suggested that at the first instance, the Government should examine as to whether import of goods from China or Chinese goods imports from other Countries poses any threat to health of Indian citizens and if so, remedial steps should be taken to ensure no entry of such imports into India by any means including e-commerce.
Immediate steps are needed to provide a package to Indian traders and small industries to strengthen their production capacity so that the flow of the supply chain should not be disturbed. Under long term measures, the Government should also carve out ways and means to ensure that over-dependence on any Country should not happen as it will cripple our economy.