China’s renewed veto to stall New Delhi’s appeal to the United Nations to label Pakistan-based Jaish-e-Mohammed chief Masood Azhar a terrorist has understandably caused consternation in India. This country strongly believes on the basis of evidence that Masood Azhar was behind the Pathankot terror attack and needs to be brought to book. With all attempts to cajole Pakistan to take action against Azhar having failed, the UN route was considered apt to punish this inveterate rabble-rouser and terror perpetrator.
The public revulsion in India over China’s veto has led to renewed appeals on social media to boycott Chinese goods which have invaded pavements and shops alike in India with their uncanny price advantage. Many Indians were livid when in April last China opposed India’s bid for membership of the Nuclear Suppliers Group which would have catapulted this country to the status of sitting on the high table of nuclear powers. But for China’s opposition, India would have had a smooth sailing.
There was at that point too a flood of mails on social networking sites asking for boycott of Chinese goods. The veto on action against Azhar has only increased the pitch of the anti-China campaign.
There is no mistaking the fact that the Chinese government is inimical towards India. While this has a lot to do with India’s emergence as a power to reckon with in the region, the Chinese antipathy towards India has got reinforced by New Delhi’s closeness to the United States in recent years.
There is a natural tendency for China to think that the US and India are hatching a plot to marginalise China. Indeed, there is some truth in the fact that the US looks upon India as a possible counterpoise in its plans to contain China’s hegemonistic designs which have been manifest in Beijing’s relations with some countries in the region.
The bonhomie that was on display when Chinese President Xi Jinping visited India in 2014 and when Prime Minister Narendra Modi paid an official visit to China a few months later was dictated by realpolitik as is usual with such visits. Yet, it is good that there is a businesslike relationship between the two countries despite their differing standpoints on several issues.
The BRICS (Brazil, Russia, India, China and South Africa) grouping gives the two countries a forum to meet and exchange notes. Nevertheless, the rivalry between the two Asian powers manifests itself from time to time.
Is there merit in such campaigns like the one to boycott Chinese goods? India is bound by the WTO charter and cannot stop or restrict imports from China in an unfair way. And why should it? But there is nothing to stop Indians from refusing to buy Chinese goods. The Chinese sell cheap and that attracts the Indian middle class. That these goods lack quality control and some of these have even been found to be toxic is largely ignored.
One cannot but recall how the US had banned Chinese toys some years ago when quality checks on them found a measure of toxicity.
Invariably, these cheap Chinese goods are made in factories where wages and working conditions of workers are pitiable. To add to that there is price under-cutting with the Chinese government’s active participation so that small manufacturers in the host country are driven out of the market. In 2014 it cost $1,332 on average to export a container from India, compared with $823 to ship from China. The solution also is the need to increase India’s domestic competitiveness by improving the roads, ports and railways in India.
The crippling effect the cheap Chinese goods have had on the small scale sector in India is indeed cause for concern. Thousands of small scale and cottage industries have turned bankrupt, causing large-scale unemployment especially in the rural and semi-urban areas.
In the last four years, commerce between the two nations has failed to match its peak of $79 billion in 2011, according to data compiled by Bloomberg. China’s trade with the United States has grown 21 percent in that time to $627 billion. Moreover, India has a trade deficit with China of nearly $50 billion, its largest with any country. Singapore, with a population about 240 times smaller than India, sells twice as many goods to China each year.
One way to help eliminate the trade deficit is to get China’s manufacturers to start making goods in India. So far, Chinese foreign direct investment into India has been miniscule: $1.36 billion over the past 16 years. While the scope is immense, it would be difficult to take this figure to a significant level, given the distrust between the two countries.
There is no point in living in a make-believe world that the boycott of Chinese goods by Indians in a private capacity would hit China hard. But it is reasonable to infer that it would have some impact and could well cajole the Chinese to think hard whether it is worthwhile to infuriate the Indian people in what could potentially be a vast market for Chinese exports to India.
There is the example of Japan where that country had allowed the import of American oranges, but the Japanese did not eat a single American orange and let them rot. This was because the Japanese wanted to support their farmers although Japanese oranges were bitter compared to American oranges. When the Japanese could teach the Americans a lesson, why can’t the Indian consumer do the same with Chinese goods?
