[WN]- Anti-China rhetoric gained momentum following the recent skirmish in Ladhak, along with the government’s call to promote indigenous goods.
Earlier this year, when COVID cases were raging in China, several retailers in India put on hold their orders.
Local retailers could rescind their contracts on Chinese imports of unbranded low-value footwear, accessories, bags, cosmetics, as they look for local alternatives amid the growing momentum to boycott Chinese goods.
Retailers said anti-China rhetoric that gained momentum following the recent skirmish in Ladhak, along with the government’s call to promote indigenous goods under the “vocal for local" push is helping them firm-up their decision. As a result, several retailers are having conversations with their sourcing teams to look for local alternatives here.
“We have already discussed with our merchandising team. We should try and avoid China this time, at least for this particular year, we will not be selling anything from China," said Lalit Agarwal, chairman and managing director at value retailer V-Mart that has over 260 stores in India.
The company imports a small proportion of its general merchandise including footwear, kids wear, and some accessories from China. The retailer is currently saucing for local partners who will supply such goods to the chain at competitive prices.
Earlier this year, when COVID cases were raging in China, several retailers in India put on hold their orders as factories in China closed down to control the disease.
Now that trade has resumed, Agarwal said future orders from China remain uncertain, for now.
Apparel and footwear retailer Woodland is in talks with vendors to seek local alternatives to Chinese imports for certain raw materials in line with prime minister Modi’s call to go “vocal for local".
However, the company said it will take another quarter to reduce reliance on imports as it “isn't an overnight job". The retailer has 20 manufacturing facilities in India that ensure 80% of its production is domestic.
“With the recent advice of the ministry, we too are working towards ensuring the maximum production within our facilities. We will certainly try to move out of or look for alternates for our raw materials and technical requirements which might take some time to be supplied by Indian raw material suppliers," said Harkirat Singh, managing director, Woodland.
It is improbable for India to wean off from Chinese imports as the country’s consumer market is flooded with Chinese goods. Several large companies spanning electronics and mobile phone makers sell goods that are either fully made-in-China or source Chinese components.
Favorable policies as well as manufacturers who can make large-scale specialized products will require investments in the domestic market over several years for Indian manufacturing to gain more ground, said Avneet Singh Marwah, CEO SPPL, that is the exclusive brand licensee of electronics brands Thomson in India.
This week, Marwah launched a Thomson washing machine that is "made in India", with raw materials imported from China. Marwah is on track to invest ₹1,000 crores in the next five years in a new consumer appliances facility in Uttar Pradesh, where the company will push for domestic manufacturing of molds and motors of washing machines.
With anti-China sentiment gaining ground, in a survey by LocalCircles on Friday among 32,000 respondents an overwhelming 87% agreed to boycott Made in China goods. Close to 40% said they won’t buy products or services offered by brands such as Xiaomi, Vivo, One Plus Oppo, Club Factory.
However, they will continue using them if they already own such brands. But even as the anti-china momentum grows, not all are convinced.
China cannot be undone from any country, said an importer who has been buying goods from China for several years now.
New Delhi-based distributor Smit Bangar, who has been importing footwear, apparel, and mobile phone accessories from China for over two decades, said he has stopped the purchase of discretionary consumer goods from China given the weak demand in India. "We are importing stocks that are only essential and will continue doing so."
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