Can India snap $84 billion economic ties with China over Masood Azhar issue at UN?

Amid mounting tensions, should India use trade as a weapon against China?REUTERS/Adnan Abidi/File Photo

As China blocked India's bid to designate Jaish-e-Mohammad chief Masood Azhar as a global terrorist in the United Nations Security Council 1267 list, for the fourth time in a row, Twiterrati went into an overdrive calling the Narendra Modi government to snap economic ties worth $80 billion.

#BoycottchineseProducts trended in no time after reports of China's latest attempt to oppose India on diplomatic front emerged. People posted tweets tagging Prime Minister Modi and various Union ministers urging them to immediately ban Chinese imports.

By again stalling India's move to declare Masood Azhar as GLOBAL TERRОRIST at UN, China has openly shown it supports terrогism. #BoycottChineseProducts #CKMKB pic.twitter.com/hrdbyQ746H

— Rosy (@rose_k01) March 14, 2019

By buying Chinese product we r doing biggest mistake of our life so#BoycottChina#BoycottChineseProducts#BoycottChineseGoods pic.twitter.com/qYuJQsmp5C — Virat kohli (@Tweetskohli) March 14, 2019

By buying Chinese product we r doing biggest mistake of our life so#BoycottChina#BoycottChineseProducts#BoycottChineseGoods pic.twitter.com/qYuJQsmp5C

— Virat kohli (@Tweetskohli) March 14, 2019

Very curious how many people tweeting #BoycottChineseProducts are using phones from China – Xiaomi, Vivo, Oppo, Huawei, Gionee. — Niha Masih (@NihaMasih) March 14, 2019

India is a $68 billion market of Chinese goods

Ironically, diplomatic relations between India and China have soured under PM Modi and bilateral trade touched an all-time high of $84.4 billion. Indian products exported to China amounted to just $16.34 billion in 2017 as compared to Chinese exports worth $68.10 billion, according to official trade figures reported by the Times of India.

India is a home to the Chinese electrical appliances market that alone amounts to nearly $22 billion. Besides, India is the biggest market of Chinese fertilizers and antibiotics valued at $1.03 billion and $733 million, respectively. China also sold organic chemicals to India worth $6.6 bllion in 2017, as per the official data.

made in China India
Demonstrators shout slogans during a protest organised by the activists of Swadeshi Jagran Manch, a wing of the Hindu nationalist organisation Rashtriya Swayamsevak Sangh (RSS), as they demand the boycott of Chinese products, in New Delhi, India, October 26, 2016.REUTERS/Adnan Abidi

On the other hand, India exports diamonds, copper, cotton and zinc to China. Indian exports to China have increased significantly under the BJP-led government by nearly 40 per cent.

How can India ban Chinese products?

The calls to ban Chinese goods in India have been made many times before in the Parliament during Indo-Chinese border skirmishes and its persistent support to Pakistan. However, the BJP government had stated in the Lok Sabha that it was not possible for India to ban Chinese products due to obligations under the World Trade Organisation (WTO).

"Just because we may not like certain things about a country is not reason enough to block imports from that country. We could impose anti-dumping duties, but there are established ways to go about it and dumping has to be proved," former Union Commerce Minister Nirmala Sitharaman had said.

However, experts opine that India can trump WTO guidelines for snapping economic ties with China as the latter did with many other countries. An opinion piece in Business Today states that China had snapped business relations with South Korea, Norway and Mongolia even as these countries threatened to approach WTO for violation of the guidelines.

Brahma Chellaney had written that India can use its powerful weapon of trade in a similar fashion with China. In fact, China's surplus exports to India can easily finance the China-Pakistan Economic Corridor every year. "India can hit China hard if it wants to," the economist wrote.

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