There are
diametrically opposite views over the war cry “Boycott Chinese Goods” as
strategic riposte on the economic front. It is conceding defeat even before the
war has begun – rank cowardice. Sacrifice to secure national interests is
anathema for self centric political leaders and industrial barons whose sole
end objective is profits.
Arraigned on either side are the spirited
nationalist groups including traders association and academic economic experts
and industrial barons. Also, the opportunistic political leadership is every
ready to exploit the opportunities to adopt most appropriate decision to
consolidate their vote banks. National security interests are the least concern for all alike.
As per academic
economic experts and industrial barons, the boycott of Chinese goods makes no
sense and will have no impact as China is a massive economy of almost 14
trillion dollars compared to India’s 2.7 trillion. As our total import from
China stands at about 100 billion dollars, even if we stop it completely, the
Chinese dragon is not going to miss it much.
At the same
time, there are the small businesses and start-ups that support the boycott of
Chinese goods to safeguard their interests.
For political leaders are guided by the mood of the nation – sentiments
and emotions. Hopefully, people are upset
over the “Great Betrayal” by China. So, political leader’s decisions are guided
by people’s moods.
What
are the realities? China's economic growth since the 1980s is unparalleled.
Between 1960 and 1980, its share of global GDP increased from 1.1% to 1.2%. By
2018, China's share of global GDP had increased to 13%. It is mostly based on
export led growth.
However,
trade by itself cannot hurt Chinese security interests due to its miniscule
share. Most importantly, more than 50% of India's imports from China are either
capital or intermediate goods. Consumer goods, which are more likely to bear a
Made in China label, have a share of less than 20%. So what? Import substitution is vital
imperative for economic rise which depends on access to financial support,
technology as well as export markets.
Viewed
in a holistic contest, the possibility of an offensive on the economic front
appears a distant prospect if considered from the narratives, discourses and
debates in the media. In boxing parlance, it is “throwing the Towel into the
Ring” by either the Coach or the Seconds outside the Ring conceding defeat of
the boxer.
Furthermore,
there are only occasional narratives appearing infrequently in the media about
India’s capability to wage war on the “Technology Front”. Who is again
responsible and accountable for such a disastrous state in the “Technology
Security” forming the key part of national security?
Similarly, the
status on the “Soft Power” dimension of national security is also suspect. Former diplomats and experts have cautioned
the nation that there may be many nations expressing concern over Chinese
transgressions/incursions contrary to mutually concluded Memorandum of Understandings
highlighting the need to maintain peace and tranquilly on the LAC, but in case
of either final show down either on the diplomatic front or in the military
field, many would remain spectators on the sidelines.
On
the internal political front, the opposition parties are hell bent upon singing
their “external masters diktat” and driving a wedge in the unity vital to
overcome external aggression.
Despite
such demoralizing overtones and odds, the “hard power” – the Armed Forces as
the last bastion – is prepared to protect the “Sovereignty and Security” of the
nation by valiantly wage war against Chinese PLA.
Should
Modi-led NDA government cave-in and surrender to the Chinese offensive or should
it rally around and put up a valiant fight to protect and consolidate its sovereignty?
And, who is responsible
and accountable for the present dismal state of the economic power the nation
which constitutes the main source of maximizing “Hard Power – armed forces” and
also the “Soft Power”.
Ipso
facto, the blame squarely falls on the political leadership of the nation over
the last 73 years. All that the political
leadership and parties have been repeatedly asserting to the “gullible masses
or vote banks” is that the nation at the “cross-roads of realizing it full
potential over the past 50 to 60 years; and, lately in the new millennium that
the nation on the “Raising” course to become a great power.
Comparative
analysis of global rankings of China and India from 1949 is highlighted for the
readers to draw conclusions. One, on 01 October 1949, “People’s Republic China
(PRC) emerged totally war ravaged after World War II followed by the
revolution. Two, according to the World Bank in 1978, China's GDP grew from $149.4
billion at 11th ranking and India’s GDP was $.137.3 billion at 12th
ranking. And, Deng
Xiaoping introduced the policy of “Four Great Modernizations”.
Three, by 1990,
China’s GDP still was $360.86 at 11th ranking and India’s GDP was
$320.98 at 12th ranking. Four, there was rapid change thereafter. In
2004, China’s GDP increased to $1955.35 at 6th ranking and India’s
GDP was $709.15 at 12th ranking only. Five, ten years down the line in
2014 China’s GDP rose dramatically to $10,438.53 at 2nd ranking and
India’s GDP was laggard at $2039.13 at 10th rank marginally
improving from 12th ranking.
Now, in 2020, China
Nominal GDP is $14.14 trillion at 2nd ranking and India’s GDP is India
Nominal GDP: $2.94 trillion at 5th rank.
The
comparative data clearly reveals that Indian economy growth remained sluggish
until 2004. Even thereafter till 2014, India’s ranking marginally improving to
10th place. And in 2020, India’s ranking has moved to 5th
rank. And, the target has been set to
achieve US5trillion economy which due to economic recession on account of COVID-19
appears a Himalayan Challenge.
Thus,
all the ruling parties are equally responsible and accountable for the
“elephantine growth” until 2014.
Growth
in two fields is recorded to provide a perspective between China and India. For
example, in the electronic fields, the Electronics Corporation of India Limited
(ECIL) was established under the Department of Atomic Energy, on April 11, 1967
at Hyderabad and credited with producing the first indigenous digital
computers, TDC 312 and TDC 316, solid state TV, control and instrumentation for
nuclear power plants and first earth station antenna of India, to create a
strong indigenous base in electronics, has woefully remained a laggard in
producing semi conductor chips and even consumer electronics.
Liberalization of India’s telecom industry was
initiated in early 1990s. The Industry has grown over twenty times in just ten
years, from under 37 million subscribers in the year 2001 to over 846 million
subscribers in the year 2011, and 1.1514 billion at the end of December 2019.
As of Dec 2019, India has the world's second-largest mobile phone user base
with over 1.1514 billion users
The Electronic
component industry was valued at $ 13.5 bn in 2015; of which Electro-mechanical
segment had the highest share at 30%. Passive and active segments handled 27%
and 22% share, respectively, while the remaining market of 20% was handled by
the Others segment. Nearly 70-80% of the electronic components market is
imports-driven.
The government has placed electronics
manufacturing on high priority with a major focus on initiatives such as
Digital India, Make in India and supportive FDI policies to bolster electronic
manufacturing. As a result, domestic production is expected to grow to $104
billion in 2020.
In contrast, it was only in 1998 that China created Ministry of
Information Industry (MII) which restructured China Telecom into three parts:
China Telecom (fixed-line), China Mobile (Mobile) and China Satcom (Satelite).
Followed the second restructuring in 2002 geographically into north and south.
Parallel to this double fission, the telecommunications division of the
Ministry of Railways (MOR) established a new actor in 2000: China TieTong.
According to China Daily, 286.2 million personal computers
(90.6% of the global supply), 1.77 billion phones (70.6% of global supply of
smartphones) and 109 million units (80% of global supply of air conditioners)
were produced in 2015. Today, China is the world's largest manufacturer of
mobile phones, computers and televisions, respectively producing over 90
percent, 90 percent and 70 percent of these devices in 2018.
China's electronic information industry, like much of its
economy, is both export-oriented and foreign capital-led. Top 10 Electronic
companies include: Aigo, Haier, TCL, BBK Electronics, Huawe, Lenovo, OnePlus,
Oppo, Vivo, and Xiaomi. The electronic information industry has grown three
times faster than the national GDP growth rate and has grown faster than the
machinery manufacturing and metallurgy industries.
Revenue for the Electric Component Manufacturing industry in
China is expected to grow to total $302.6 billion.
Next, in the crude steel production from 1950 onward,
both China and India were at the same level of about 1 MTPA capacity. By 2017, China
achieved a remarkable steel output of
803.8 MTPA producing almost 50% of world steel. Its rise was mainly from
2000 onward. China imports iron ore from India also. In case of India, there
has been slow but steady growth throughout the period. The Ministry of Steel
aims to increase the steel production capacity to 300 million tons by 2030-31
from 134.6 million tons in 2017-2018.
Besides rich
iron ore, there are 95 minerals produced by India – 4 fuel-related minerals, 10
metallic minerals, 23 non-metallic minerals, 3 atomic minerals and 55 minor
minerals (bauxite, copper etc); but mostly exported instead of value addition
to Japan, China and South Korea instead of producing both for export and
domestic markets – loot and scoot of raw materials. India holds a fair
advantage in cost of production and conversion costs in steel and alumina.
No wonder,
India’s academic economic experts, particularly those in foreign countries, are
harping on the present large scale dependence of imports from China and
comparatively low exports to China justifying the continuation of trade
relations having failed to ensure import substitution whilst they enjoyed
prized posts to steer the economy. And, the industrial barons would toe their
line at the cost of growth of domestic industries in all fields. For, they are
only concerned with their profits and least concerned with national security
interests.
In retrospect,
“Fraudsters of Hindustan”, who were in the forefront of “looting and scooting”
the nation, are squarely responsible and accountable for the current dismal
state of the nation. Dismal have been
the policies, strategies and processes of the past on the economy front. Self aggrandizement was the sole interest of
political leaders; but not the society or national interests. Corruption since
1980 has engulfed the nation.
However,
the blame also squarely rests with the “We the People” for regularly electing
“Fraudsters” as their leaders to steer the course of the nation to realize its
full potential. Even now it is never too late for “We the People” to send the
“Dynasties, Neo Dynasties, Cronies, Criminals” masquerading as leaders to the
dustbin of history.
Never late than
ever, Modi-led NDA government must carry out pragmatic review of the economic
scenario from short, mid and long terms views and stop promoting China’s
national economy security interests at the cost of India’s economy security
interests.
After all, why
award contracts to Chinese firms to execute infrastructure projects when India
has such heavy weights like L & T, GMR and others?
Similarly,
there is vast scope available for domestic manufacturing to substitute Chinese
imports in various fields and also for exports. Encourage and develop
technology through indigenous innovation.
Stop export of raw materials and ensure their exploitation by expanding capacities and encouraging setting
up of additional capacities like steel production to reach 300 MTPA by 2025
instead of 2030. Similarly, fast pace growth in all other sectors.
Otherwise, India
can never catch up with China in advancing and consolidating economic power
which is vital for maximizing “Hard” and “Soft Power” to match and face Chinese
threats on all fronts of national security.
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