Diwali is near and there is a joke on social media. The question being asked is whether to oppose the Chinese scams or not? The story behind this joke is that some time ago, when the rise of nationalism was at its peak after the arrival of Narendra Modi on the national horizon, there was a campaign against Chinese goods. Among them, strings of small lights i.e. Jhalar during Diwali, Pichkaris during Holi and kites and manjha during Makar Sankranti were most opposed. All these things still come from China. Gradually, when it came to light that India’s domestic and foreign business was being run with the help of China, the nationalists became silent. Then before Diwali, to tease them, they are asked whether they want to oppose the skirts or not.
But leaving this joke aside, it is not just a matter of fringes, incense sticks, pichkaris, kites and manjas, but India’s pharmaceutical industry, agriculture sector, automobile sector, mobile and the entire IT sector is running on the support of Chinese products. The Prime Minister and other ministers of the Central Government proudly say that India ranks second in the production of mobile phones.
But that is not actually production, but assembling, most of whose parts come from countries like China, Taiwan etc. Similarly, it is trumpeted that India exported iPhones worth thousands of crores of rupees. But what happens to India in that? The iPhone manufacturing company is from America and most of the parts are made from other places, which are assembled and sent to India. In this, India gets money only for wages!
In fact, India’s own raw material is very less in the production of whatever India is exporting, only labor is used. It will be surprising to know that the things that India exports are manufactured by bringing goods from China. That is, products are made from Chinese goods and they are sent abroad after being stamped as made in India. Last year i.e. in 2023, the share of parts brought from China or raw materials imported from there was 68 percent in India’s exports. This means that China’s share in the products exported by India is 68 percent.
It can also be understood that if India exports goods worth Rs 100, then goods worth Rs 68 are from China. This also means that India’s exports increase, which is trumpeted by the government every time it increases China’s earnings. The share of Chinese raw materials or parts made there in the goods exported by India is now 68 percent, which was 59 percent in 2015. That is, at a time when patriotic people were boycotting Chinese skirts, pichkaris and kites and tensions with China were at their peak, India’s trade with China was booming. It can also be said that China was and is the only support for making Prime Minister Narendra Modi’s self-reliant India and realizing the slogan of Make India.
Another statistic regarding trade with China is very interesting. In India, the trade of capital goods i.e. machinery used in industries has increased the most from China. This type of machinery is used in agricultural operations or in the pharmaceutical industry or in other industries. India is buying more capital goods from China than any other big country in the world. According to a report by Elara Securities, between 2019 and 2023, imports of capital goods from China have increased at the rate of 19.23 percent annually. In comparison, if we look at China’s capital goods trade in other countries of the world, it has grown at the rate of 8.4 percent. That is, the sales of China’s capital goods i.e. industrial machinery have increased at more than double the rate in India in other countries of the world. This means that India is becoming almost completely dependent on China for the needs of industrial machinery in every sector of India.
The situation is that India alone imports 15 percent of what it imports from the world. That means if India’s import bill is Rs 100, then Rs 15 of it goes to China. India is dependent on China for small household items as well as raw materials required for big machinery and big industries. In some cases, the story resembles the plunder of the British Raj. That means raw material from India goes to China and finished goods from there come to India and are sold. The amount of Chinese steel business growing in India is an example. India exports much less from China than it imports. This is the reason why trade deficit is continuously increasing. Since the campaign for self-reliant India was started in 2020, the trade deficit with China has increased by more than five and a half percent.