Will anti-China sentiment impact Chinese brands in India?
2 min read 24 Apr 2020, 06:26 PM ISTThis isn’t the first time that Chinese products or brands have drawn flak in IndiaMany Chinese brands have endeared themselves to Indian buyers by joining Make in India campaigns, roping in local celebrities
PremiumNEW DELHI : The covid-19 pandemic is reviving sentiments against Chinese products in the country. The recent backlash against China over faulty testing kits or alleged suppression of actual numbers of infection, are fuelling online campaigns in India urging people to reduce dependence on Chinese electronics and refrain from buying them.
“Post covid-19, with all the conspiracy theories going on, there is certainly a huge degree of negativity that is knocking on China’s doorstep," said Harish Bijoor, a Bengaluru-based brand consultant. “Currently, this negativity rests within the geography of China. Whether that negativity is nullified for products manufactured outside the geography of China is yet to be seen," he added.
This isn’t the first time that Chinese products or brands have drawn flak in India. In 2014, Xiaomi was pulled up and its phones were banned by Indian Air Force, after security company F-Secure found that the phones were sending details like phone number, IMEI number, name of operator to a remote server in China. During the Doklam standoff, yoga guru Baba Ramdev had urged Indians to boycott Chinese products.
Faisal Kawoosa, founder and chief analyst at techARC, felt that a few online campaigns will not stop people from buying Chinese electronics. “When we had a confrontation with China over Doklam, similar sentiments surfaced, but eventually they all fizzled. We are living in a world where every country depends on another for something. Today if you have to get something manufactured, you have to turn to China for components," he added.
Many Chinese brands have endeared themselves to Indian buyers by joining Make in India campaigns, roping in local celebrities to endorse their phones and sponsoring popular cricket tournaments like IPL. Many of these vendors have time and again laid emphasis on the fact that their handsets are made in India. For instance, 99% of Xiaomi phones sold in India are reportedly assembled in India with components imported from China.
Bijoor points out, Chinese companies are very good at managing their brand image and they are going to do that on a war footing. “In the short term this will raise questions in people's minds, but in the medium term I don’t see any impact of these campaigns on Chinese companies or products," he added.
India relies heavily on China to meet its electronics requirement to the extent that after the prolonged lockdown of factories in China due to the outbreak, supplies of several premium handsets including iPhones in India was disrupted back in March.
Chinese companies accounted for more than 70% of all smartphone shipments in India in Q4 2019, as per IDC (International Data Corporation). The total size of India’s trade with China was $87 billion in 2018-19, as per India’s Ministry of Commerce, with electronics accounting for $20.6 billion of total imports from China.
Almost 90% of components used in phones that are made in India come from China, points out N.K. Goyal, president, Telecom Equipment Manufacturers Association, adding, “however, after covid-19, world has started to realise that depending on global chain isn’t the best answer. More and more countries are going for domestic production. Many companies also want to shift their manufacturing base. India appears to be a promising location."
But these things don’t happen overnight and anti-China sentiments alone cannot drive that shift.
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