China has got this bee in its bonnet that the country is slated to be the greatest power on earth, replacing the Americans from now on. In that process China perceives dominating India as the first step. It wants to awe India with the hardest strikes to bring it round to accepting China’s suzerainty.

Today, it is the Galwan valley in Ladakh. Tomorrow it will be in Arunachal Pradesh and yet another day it will be Indian navigation rights in the Indian Ocean waters. Today, it is confronting India; tomorrow it will directly get into a fracas with the United States. The day of reckoning will come.

In this endeavour there are no grey areas. Either you accept us or we subdue you. Hence, the faster India is convinced about the need to confront this challenge and prepare for it the better.

In this effort, the importance of economics is supreme. Soviet Union in its heyday was a far greater force than China today. But there is a difference. Soviet Union was a bankrupt economy. Whereas in her four decades, China has built a powerful economy.

It is here that India has some strike power, though we must not harbour illusion about its depth. We have a large trade deficit with China — in excess of some $50 billion. But that is peanuts, considering that its export volume with USA is ten times as much.

But it is not the present value but the future net worth that matters. India will not stand idle with sluggish growth rates for all times to come. We will return to a high growth trajectory soon enough and our market will expand accordingly. That will be the attraction.

We must prepare right away to keep out China from this market of the future. The action, however, must begin today. First is the issue of investment. Chinese investments in India have increased hugely over last few years. Currently, according to some figures Chinese investments add up to $8 billion.

More specifically, Chinese have invested heavily in Indian technology companies and wha are known as the unicorns. These are extremely important components of India’s new economy and they support large employment, especially of technology savvy young people. Some 18 of India’s 30 unicorns have received funds from Chinese venture capital funds and other such investors.

Shutting the Chinese would shut out funds from these start ups, it is pointed out. However, as is well known, funds are no longer the limiting factor and such investments should flow from a variety of other sources even if the Chinese are kept out from the Indian markets. Investment dollars are now looking for fresh avenues and one of the largest such collection of investors is in Japan.

The second area which should get immediate attention for wiping out Chinese companies and more importantly technology is the telecommunications industry. India’s mobile handset market is exploding and it will increasingly opt for the more costlier handsets. At present, no less than 70% of the mobile handset market is in the bags of a handful of Chinese manufacturers. It is absolutely important that the mobile handset market must pass on from Chinese companies to Indian ones or at least Indian outfits of non-Chinese mobile makers.

When the border fracas is coming to such messy levels, we should not flinch from the idea of taking over the Indian plants and assets of Chinese mobile makers in India. Just three Chinese companies, namely, Xiaomi, Oppo and Vivo have invested upwards of $500 million in plants in India. These should be taken over if the hostilities continue or get worse. Let the claims of Chinese companies then be fought out over years.

Critics will say this is harebrained and such moves will hurt India’s image as global investment destination. However, when it comes to defending the very sovereignty such matters can at best have secondary importance.

The more invidious area is introduction of Cheese technology in the telecommunications backbone infrastructure. Chinese have been known to have planted micro chips and other bits to enable all data and information flowing through the network to be accessible to Chinese eavesdroppers. There was a major controversy around this some two years back.

It is good that the department of telecommunications is now considering to weed out Chinese companies from bidding for large telecoms projects. BSNL has been asked to rework its bidding conditions so that Chinese companies cannot participate in Indian telecoms networks. The private sector companies should also be asked to fall in line. BSNL had almost finalised handing over project for migration to 4G of large networks in some metropolises and smaller towns to the Chinese company ZTE. This should be stopped forthwith.

Another controversy was raging around the Chinese company Huawei.

Countries such as Australia, New Zealand, Japan and Taiwan besides the US are keeping Huawei out of 5G deployment, while others such as France, the Netherlands, Russia and South Korea have allowed the Chinese equipment maker to participate. The UK is reviewing the impact of the limited role that it had allowed Huawei.

The third area where the Chinese companies have done booming business is in supply of power generation plant and equipment. Much to the chagrin of Indian manufacturers page projects were just given over on a platter to Chinese manufacturers just because they were under-quoting. However, once installed, the plant and machinery had given the most unsatisfactory performance.

In one case, when the machinery got stalled, the Chinese company insisted on sending these back to China and repair than d the job here. The maintenance and repairs thus proved to be costlier than the machineries. The low initial upfront price was more than doubled up in course of repair and maintenance thereby shooting the overall price to far beyond viable levels.

Lastly, India should impose strict quality norms and shut out cheaper and low quality Chinese products. In case of toys for example Chinese companies used toxic paints on toys along with materials having higher toxicity for children playing with these. Not to mention periodical controversies with serious toxicity in Chinese milk foods for babies to dangerous compounds found in Chinese drugs and food products make China a source of serious contamination and spread of diseases.

This is the ideal time to begin getting rid of the Chinese from the Indian market. Indian manufacturers and industries should get breather to make a fresh beginning. Though almost middle aged, Indian industries and manufacturers could even be given infant-industry protection to rid from the Chinese. There will be more space for investments from other countries for manufacturing in India. (IPA Service)