China COVID-19 curbs could hit Indian manufacturing: Crisil
The tough restrictions imposed by China to curb COVID-19 transmission could hurt India’s domestic manufacturers as supplies of key import items such as plastic, chemicals and mechanical equipment have slowed down, rating agency Crisil said on Monday.
India’s import dependence on China has reversed gains made prior to the pandemic, with its trade deficit rising drastically to $73 billion in 2021-22, the firm noted. India’s goods exports to China were $21.2 billion (stagnant compared with 2020-21), while imports surged to $94.2 billion from $65.3 billion the year earlier, making the country India’s biggest import partner.
“…Supply-chain disruptions in China will likely persist through the rest of year… In such a scenario, further slowdown in imports from China could potentially affect manufacturing activity domestically,” Crisil said in the report, pointing to a contraction in imports of electrical machinery, boilers and mechanical appliances, and base metals, along with a progressive slowdown in plastics and chemicals imports.