The public anger and outrage is quite understandable. However, we need to analyze whether the call for boycotting chinese goods is an effective and a practical strategy. And if not what else can India do to counter China on its rampant acts of military bullying and economic muscle power.
Generally we tend to think that if people stop buying foreign goods, it will incur losses on that country and it will fall in line or get weakened. However, international relations and trade in today's world does not function in such simplistic manner. Boycotting Chinese goods is practically not possible. Let me give two reasons.
Firstly, we all live in the age of globalization. International economic order is defined by system of 'supply chains'. Now lets understand what is supply chain. Globalization has allowed global companies to manufacture goods through supply chain. For example, there is an American automobile company that manufacture cars. The production of a car will involve several countries in such a way that the company is able to utilize best of resources from the world in most efficient way. For example, it sets up its factory in China because of availability of cheap labour and land, import steel from India because of its quality and price, buy textiles for its seats from Vietnam, import rubber for its tyres from Malaysia. The company altogether will be registered in Mauritius due to tax benefits provided by the government. It will have its stocks on European Stock Exchange. So what do we say about which country produced the car? This is true for most of the Multinational Corporations ranging from automobiles, textiles, electronic goods, food items, foot-wears, etc. China being a strong player is part of almost all supply chains. Thus it is impossible to isolate and link goods with a particular country because its is practically not true.
Secondly, we have high import dependence on China for some of our most important and core industries. We take pride in being the 'pharmacy of the world'. We are leading player in manufacture of generic drugs and vaccines in the world. But do you know that we rely on China for 70% of APIs used to manufacture our drugs. Our fertilizer industry stopped functioning during lockdown because of lack of organic chemicals that we import from china to produce fertilizers. This is true for most of automobile and electronic parts.
Further, boycotting few chinese goods will not have any major impact on it as we think. China is largest exporter of the world. India is its 7th largest trade partner which accounts for less than 5% of its total trade. We saw that most of our imports are critical for our own industries and we cannot stop them. However, if we still assume that we stop all of our imports, it will still be not be a major jolt for its economy. Then what? it will further not care for India's interests because now it has nothing to worry about!
Now the question is what shall be our strategy then? The simple answer is to build up your capacities to match up China; not by boycotting but by building. Take examples of major developed nations like Germany and Japan. Boycotting one countries's good and buying from other don't work. We need to first have 'Mitsubishi' and 'Volkswagen' of our own. India has always focused on bringing investments but never focused on building up big companies of our own.
We are almost equal to China in terms of our population. We need to utilize them efficiently by ensuring their good health, providing them world class education and state of the art skills. Our demographic dividend can turn the tables round the world. We are already strong in service sector because of that. We should make use of our young workforce, not just by ensuring them jobs but also by supporting them to be entrepreneurs and prepare them to contribute in research and technology for our country. Having our own start-ups, our own technology, our own defense systems, our own Information and Communication Technology, we can match up China economically very soon.
We need to counter China in its influence over international institutions. Our political clout must be very strong for that. We are world's largest democracy. This gives a natural similarity with powerful western nations and societies. India has a history of being responsible and non aggressive nation. We have goodwill among developing and under-developed nations in Africa, Latin America and Asia. We need to utilize our relations with them to increase our weight in international institutions. We are already doing a good job in that. One major requirement for that is to end the bitter political conflicts at home. All varying factions need to unite for our country when it comes to India's international image.
Power is defined not always in terms of money or military. There is something called Soft Power. We have a magnanimous cultural heritage and traditions. We also have a huge and strong diaspora. We can utilize them along with our diplomatic institutions to spread our culture, language, cuisines, handicrafts, music, dances and so on. Connecting the world with our way of life ensures a strong people to people connection which becomes bedrock of international partnership, sympathy, closeness and support for India.
Lastly, world is made up of nation-states. All of them are individual actors who seek to maximize their interests. There is anarchy in the world and conflicts are bound to happen. In international relations, there is no permanent friend and permanent enemy. Nations align with each other based on goals and interests. Same is the case with India and China. Maturity of people of both countries is very necessary for stable relation between nations. Both countries have repeatedly stated that it is in interest of both countries to manage issues through dialogue and diplomatic mechanisms. War mongering is extremely dangerous in today's world when there are nuclear weapons. Yes,we need to stand strong when it comes to protecting our national security and sovereignty. However, the misinformation campaigns that we see in Media and social media platforms is harmful to very interest and security of our nation. Our approach and response to any matter of national and international importance must be based on rationality, logic and thorough understanding.
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