Post unlocking, companies such as Dell, Cisco and Foxconn had shipped goods for their Indian arms, which have been delayed, sources said. Similarly, mobile phone players such as Oppo, Vivo and Xiaomi, which depend on inputs and components from China, have also been hit hard. Samsung, and many other Indian vendors are also impacted, an industry source added.
“You need to aim better. People whose consignments are getting delayed are not necessarily Chinese companies, but it is just that their goods are originating from there. This is a peculiar situation,” said an industry source.
Electronics and pharma are two sectors that depend heavily on Chinese raw material and inputs. “For the pharma sector, the situation seems relatively better at Chennai port with some shipments cleared after stringent checks. But a serious logjam continues at Delhi airport, which will hamper the supply chain of life-saving medicines at such a critical time, and may have serious consequences,” Pharmaceuticals Export Promotion Council of India chairman Dinesh Dua told TOI.
Unlike electronics, the pharma industry maintains an bigger inventory. “If the problem at the ports continues for a couple of weeks, it may disrupt manufacturing of raw materials and formulations,” an industry executive said.
Critical raw materials and bulk drugs are imported from China, with the country accounting for nearly 70% of active pharmaceutical ingredients, while in certain cases, the dependence is around 90%.
The issue is also being taken by the industry association. “Consignments are having problems in getting cleared. However, we expect things to stabilise soon,” Pankaj Mohindroo, Chairman of India Cellular& Electronics Association (ICEA) said.
In a letter to Finance Minister Nirmala Sitharaman, ICEA said that the “adverse action by customs” at the ports has come without any prior warning. “Essential parts, components and accessories required for manufacture in the 200-plus factories which came up following the adoption of ‘Make in India’, ‘Digital India’ and ‘Phased Manufacturing Programme (PMP)’ in the mobile industry are in the hit list.”
The decision to subject Chinese imports to 100% inspection at ports and airports is not a local decision, as finance ministry officials had initially said. “There is a centralized risk management system, where inputs and alerts are fed, some of which can be local,” explained a senior customs officer.
An industry body executive said that going forward, there is an assurance that action will be taken a little more carefully done.