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The nationalist response of boycotting Chinese products will be nothing but self defeating.

Read on to know why:

• Make in India initiative was a good opportunity for us to get our manufacturing sector back on track. But we have not taken advantage of what we had actually planned.

• In the past five years, what we have seen is that the dependency on China has actually gone up.

• India is exporting a lot of raw materials and intermediate products, and importing finished products from China.

• There is not a wide diversification of countries from which India is sourcing its imports.

• Critical medical supplies which India has been importing for frontline healthcare workers in the COVID-19 battle, most of these come from China.

• Indian manufacturing is dependent on supplies from China. This includes a wide variety of machineries. We also import fertilizers from China.

• China continues to remain a major source of the final demand market.

• The Make in India strategy talked about FDI into manufacturing, but if you look at the data and see which sectors have been preferred by the foreign investors, you’ll see it’s all about service sectors.

• Foreign investors get into the sectors where there are acknowledged skills, for instance in IT. But we don’t have similar skill sets in manufacturing.

• It’s not just about having a good policy, but you need to have the infrastructure in place so that the foreign investor can make profits.

• There is also the red tape. It’s not enough to say that we are going up the ease of doing business rankings. We know what the situation is on the ground.

• If one lesson COVID-19 has taught everyone, it is that there’s virtually no labour laws in this country.

• We have not cared to harness the dominant domestic market adequately. And the direct implication of this increase in unemployment rate is that the domestic market has shrunk.

• Just reducing dependency on China has one set of implications, but reducing dependency on the rest of the world is an approach that will drive you up the road of economic nationalism.

• There have been very clear signals of economic nationalism in the last few years. India has gone more protectionist, and the average tariffs have actually gone up.

• If we start talking about indigenisation, that means we are trying to go down the path of import substitution. There are practical problems, because you have to garner huge resources which India doesn't have.

Foreign investors or foreign companies really don't know what’s going on here.

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