OUT IN THE COLD

The disruption due to coronavirus in China has put Indian industry in a jam

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Phrases, at times, sum up global power transitions. In the nineteenth century, Austrian politician Klemens von Metternich said, “When Paris sneezes, Europe catches a cold.” Paris gave way to “America” in the twentieth century, reflecting the shift in global trade. Now, it is a lot more about the East. When China sneezes, the world catches a cold. But what about India? Considering the economic disruption its northern neighbour is facing because of the breakout of corona virus that has claimed hundreds of lives and led to shutdown of some important economic centres.

Sample this: China is India’s secondlargest trading partner with overall trade of $64.9 billion between April 2019 and December 2019. The country also accounts for a bulk of India’s trade deficit (around 32 per cent). In fiscal 2019, India imported automobile components worth $4.6 billion from China, which was more than a quarter of component imports into the country. About 65 per cent of inputs in medicines under the National List of Essential Medicines (NLEM) come from China. In case of paracetamol, nearly 80 per cent of the material that goes into making active pharmaceutical ingredients, or APIs, come from the Middle Kingdom. APIs, or bulk drugs, are raw materials to manufacture medicines.