Soon after MeitY Secretary, GTRI highlighted China’s export curbs leading to delays in Indian electronics, solar, and EV sectors, believed to be in response to India’s restrictions on Chinese investments and visas.
Indian companies in the electronics, solar, and electric vehicle (EV) sectors are facing significant delays and disruptions due to China’s restrictions on the export of key materials and machinery, according to a report by the Global Trade Research Initiative (GTRI) released on Thursday.
This comes after the MeitY secretary highlighted these issues at an event on Tuesday.
The export curbs are believed to be a response to India’s limitations on Chinese investments and visa policies, heightening existing geopolitical tensions and contributing to a broader trade dispute between the two nations.
Ajay Srivastava, founder of GTRI, expressed concerns that these restrictions, while adversely affecting India’s industries, would also harm China’s own manufacturing and export sectors. He stressed that India’s dependence on Chinese machinery, intermediate goods, and components makes it particularly vulnerable to such disruptions.
In 2023-24, India’s imports from China grew to $101.73 billion, up from $98.5 billion the previous year. Despite this, Srivastava argued that India must focus on enhancing its local manufacturing capacity and diversifying its supply chains to reduce reliance on China.
To mitigate these challenges, Srivastava suggested strengthening partnerships with countries such as Japan and South Korea, which could supply high-quality components for India’s electronics, solar panels, and EV sectors. This approach would help India build more resilient supply chains and reduce its dependence on China.
Meanwhile, China’s export restrictions are seen as part of a broader strategy to retaliate against US sanctions targeting its technology firms. Although no bans have been specified for India, key measures taken by China include imposing controls on critical materials like gallium, germanium, and antimony, which are essential for solar cell and semiconductor production.
With China also considering restrictions on lithium and battery technologies, its role in global supply chains remains pivotal despite ongoing trade tensions.