(I am, for the first time, quoting from an eminent writer in the hope that he shan’t mind; this is not for making money. I believe that what Shreekant has to say, India needs to hear.)
“When we talk of export of smart phone, s, we do not mention that we only assemble components, which we import from China.
For our drug formulations export to developed countries, we use the basic chemical agent imported from, you guessed it, China.
The same is true of most telecommunication gear, white goods and consumer durables, machine tools, power generation-transmission equipment, etc.
China is our leading trade partner (and diplomatic-territorial adversary), but it is mostly a one-way traffic: China exports, we import.
They sell us goods worth over $100 billion, mostly manufactured goods and machinery and components, and we export about $16 billion, mostly primary products.
Our global performance shows (mostly, not always or steadily) rising exports.
On closer look, we will find that a big chunk of our exports are primary commodities.
When we export rice or sugar, we are in fact exporting substantially greater quantities of our scarce water (one kg of rice uses up to 5,000 litres of water.
Sugar, the other major commodity we export, is not far behind in its water intensity).
Big ticket items such as pharmaceuticals, gold and jewellery and now, smart phones, are really based on large imports of basic formulation, raw gold, and components.
If we consider only the value-added as true exports, our numbers would shrink greatly.
We are nowhere in exports of manufactured goods; we are overtaken by Bangladesh and Vietnam even in our traditional exports of garments.
We are far from being a second China, or China + 1, we are mostly a supplicant to China when it comes to international trade.”
20.06.2024
Shreekant Sambrani taught at IIM Ahmedabad and helped set up the Institute of Rural Management, Anand. He writes on economic and policy issues.
(https://www.deccanchronicle.com/columnist/shreekant-sambrani)
