Rating agency Crisil on Monday said stringent restrictions imposed by China to curb COVID-19 transmission could hurt India’s domestic manufacturers as supplies of key import items such as plastics, chemicals and mechanical equipment slow down. has occurred.
The firm noted that India’s import dependence on China has reversed gains made before the pandemic, with its trade deficit widening to $73 billion in 2021-22. India’s merchandise exports to China stood at $21.2 billion (steady compared to 2020-21), while imports rose to $94.2 billion from $65.3 billion a year ago, making the country India’s largest import partner.
“…the supply-chain disruption in China will continue for the rest of the year… In such a scenario, a further slowdown in imports from China could potentially impact manufacturing activity domestically,” Crisil said in the report. Machinery, boilers and mechanical equipment, and base metals, along with a progressive slowdown in imports of plastics and chemicals.