What price ‘Make in India’? The much touted slogan of Prime Minister Narendra Modi, together with his vow to ban imports from China, has clearly not stemmed the Dragon’s economic invasion of Indian markets. What is more, China has left behind the US, the UAE and the UK during fiscal 2023-24 and has emerged as our largest trading partner with two-way trade figures of $ 118.4 billion.

For the record, during 2021-22 and 2022-23 the US was India’s biggest trade partner, while before that it was the UK. During fiscal 2024, imports from China have surged to cross $ 100 billion and reach $ 101.75 billion, indicating a 44.7 per cent spurt over the earlier $ 70.32 billion.

Chinese economists have ‘hailed’ their country’s bumper exports to India as contributing immensely in reviving the sagging economy of the Dragon. During the last ten years, despite the Indian Prime Minister’s repeated pronouncements on banning the inflow of Chinese goods, our giant neighbour’s share of India’s imports have gone from 21 per cent in 2012-13 to 30 per cent in fiscal 2023-24.

According to renowned economic think tank Global Trade Research Initiative (GTRI), from fiscal 2019 to fiscal 2024, India’s trade dynamics with its top 15 trading partners underwent significant transformations, impacting both exports and imports along with the status of trade surplus or deficit across various sectors. Surprisingly, much against the repeated utterances by the Indian Prime Minister to ban imports from China, the Dragon has now surpassed our three previous leading trading partners — the USA, the UAE and the UK.

According to GTRI, goods imported from China have risen 2.3 times faster than India’s total global imports over a period of 15 years. What is more, the think tank adds, China is the top supplier to India in eight major industrial sectors, including machinery, chemicals, pharmaceuticals, and textiles, belying the general perception that Chinese imports are high only in the electronics sector. Indian businessmen are lamenting that large-scale imports from China have adversely affected their business and balance sheets.

India’s total merchandise imports stood at $ 677.2 billion in 2023-24, of which over 15 per cent was sourced from China. Of this, $ 100 billion of imports was in major industrial product categories. Does this mean that the Prime Minister’s vow to ban imports from China was an empty one?

The GTRI report also highlights the significant reliance on imports from China across various sectors. Citing trends from the first 10 months of fiscal 2023-24, it notes that almost 42 per cent of India’s textiles and clothing imports, and 40 per cent of its machinery imports in this period, came from China. For the same period, the corresponding number was 38.4 per cent for electronics, telecom and electrical products.

Naturally, the question arises of whether the much-touted ‘Make in India’ policy has made any dent in the country’s dependency on imports from China. Clearly, the time has come to review the country’s import strategies and take imaginative and effective steps to boost indigenous production. The strategic implications of the growing dependency on China are profound, adversely affecting not only the economy but also our national security.

Ergo, the need of the hour is not just patriotic slogans but effective measures to bolster industrial output across the board as well as diversify imports in order to reduce our overdependence on a giant neighbour like China. The government should make it clear whether our policy is ‘Make in India’ or ‘Make in China (and Dump in India)!