Can India really boycott made in china products?

Since India and China have found themselves entangled in a brutal confrontation in Galwan valley in Ladakh, in which 20 Indian soldiers lost their lives while China hasn't come up with their casualties yet. There has been, yet another call from the ultra-nationalists to Boycott "Made in China" products being imported into India. Is that really possible or is it just a pipe dream?

India and China started their economic liberalization at roughly the same time in the 1990s. Both countries have seen immense poverty and economic boom after liberalization. Though due to some constraints India hasn't been able to economically develop as well as China. China focused more on their economy, infrastructure, exports than India could, partly because India is a democratic country and policies tend to go through bureaucratic red tape, which is a never ending loop, while China having an authoritarian government in a single party rule i.e. the Chinese Communist Party (CCP) went on with their development agenda without any push or pull of a democratic country. Basically, if CCP decided something, it was as good as done, there was nobody to question that decision, the citizen can't really question the government policy, there is no opposition party to question the policy, nor the democratic institutions like the judiciary or legislative.

Fast forward to today, China is an economic powerhouse. It is the factory of the world. It is economically much superior to many other countries and it has ambitions to dethrone United States as the world's biggest economy. It produces most of the goods consumed on the planet. It exports its products to almost every continent of the globe. Even in the times of Coronavirus it is organizing its biggest trade fair i.e. Canton Fair completely online to cater to world imports. While this has not been easy but they have been able to achieve this feat through their hard work and dedication and an unflinching focus. No other country has been able to achieve so much in such little time ever in the history of mankind.

With an increase in economic prosperity and ambition to be the next superpower, also came the tendency to assert itself on other countries, especially since the current Chinese premiere Xi Jinping came to power. There are many reasons for the India-China standoff at the LAC but this assertiveness has led to a fairly peaceful relationship between two neighbours India and China becoming hostile. Each time any hostility is reported in the media, the nationalists on the Indian side starts arguing about the need to boycott "Made in China" products and go with domestic manufacturing while promoting self-reliance amidst rising economic patriotism. Even though it sounds completely overboard and does not support the data, it would be interesting to analyse this claim.

According to the data released by China customs, bilateral trade between these two neighbours stood at $92.68 billion in 2019. In this the trade deficit stands at $56.77 billion which is almost 60% of the total trade. It means India imports considerably higher value from China than it exports back to China. 

The top three imported and exported categories of products from/to China:

S No.	Imports from China ($ billions)	Exports to China ($ billions)
1	Electric equipment - 20.63	Organic chemicals - 3.25
2	Nuclear reactors - 13.4	Mineral fuels - 2.86
3	Chemicals - 8.6	Cotton - 1.79

The point to note in the above table is the biggest import that India have from China is electronic equipment which include, mobile phones, laptops, Computers, AC, TV and almost all kinds of electronic goods we use. These products do not have any significant production capabilities in India, also the cost comparison for China manufacturing and Indian manufacturing for electronics gives China a significant advantage. 

The other point that needs to be understood, is most of the components and raw materials that India uses in their finished and semi-finished goods come from China. Completely prohibiting these imports is going to have a serious impact on Indian domestic manufacturing industry, as well as its exports. Not to mention this can have adverse effects on the Indian consumption story. Unless India vertically integrates to an extent where it manufactures all components and raw material by itself or finds an alternate to China, it cannot ban Chinese imports. It would be a self-inflicted pain. This is also important for India to be able to take advantage of the anti-china sentiment throughout the world in terms of trade.

India and China both are signatories to the WTO agreement, which specifies there can be no trade barriers among countries. It would be hard for India to bypass that.

Conclusion:

India-China face off in Galwan valley in Ladakh has again given fuel to the "Boycott made in China" campaign undertaken by nationalists. Though India can to some extent reduce its dependence on China on goods that it can manufacture, but there are certain industries which India needs Chinese semi-finished goods and components to assemble for its domestic industry as well as exports. India is not a vertically integrated supply chain country like China so it has certain limitations. It has to either manufacture all components and raw materials itself or find another source before it could decouple from China. So, the complete boycott of made in China products is not going to happen anytime soon, not in the near future.