Boycotting China Not Feasible, Say Maruti & Bajaj

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Mumbai: Amid an increase in anti-China and “vocal for local” sentiments in the country, Maruti Suzuki and Bajaj Auto have said that the call to boycott Chinese goods is not a good business decision.

Maruti Suzuki’s chairman RC Bhargava explained that Maruti directly doesn’t import components from China but its vendors are dependent on it. “It is not easy for these vendors to find alternative sources or develop alternative sources. It takes a lot of time. What is more important is it will take a lot of cost penalty on the side of the vendors which ultimately means a cost penalty to the consumer,” he said in an interview to CNBC TV.

On being asked why the Indian industry is not becoming capable of manufacturing at competitive prices, he said, “I don’t see raising tariffs and increasing prices of products which use Chinese imports is going to benefit the Indian citizen at all. This is more of an emotional reaction to the border problem. I do not think it is a well-thought-out solution to what we need to do both to resolve our differences on the border with the Chinese and also to in the long-term reduce what we are importing from China and elsewhere.”

Bajaj Auto imports components worth around Rs 600 crore from China, MD Rajiv Bajaj said. The most prominent part imported from China is alloy wheels for most two-wheeler makers, he said. He also went on to say that letting vendors from China down after 15 years is an ethical dilemma too.

“The reason we source components from China is simply that China is more competitive. I do not mean that our Indian suppliers are dumb, they are not; we are handicapped. The issues of land, labour, logistics, legislation, and electricity – it is because of this unease of doing business that for components like these, which in our language are called non-proprietary components, we find that the Chinese source is more competitive,” he added.

 

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