China’s Factory Closures Continue, Supply Struggle For Indian Businesses?

The death toll and infected cases of lethal disease Coronavirus are on a rise which is leading China to call for a complete lockdown in most of its cities. As factories remain shut for safety reasons, there is going to be a huge business impact on India. After the World Health Organisation (WHO) declared Coronavirus as a global emergency, most Indian businesses with manufacturing industries in China are unsure of when would operations start again. 

China is one of India’s biggest trading partner especially for electronic devices, gadgets, mobile phones, and TVs. The eCommerce industry is sensing a huge loss by the possibility of no supply for some products. Popular eCommerce platforms Amazon and Flipkart might see a major effect on their sales and would see a particular slowdown since the category of electronic devices would be affected. 

The Indian smartphone market is dominated heavily by Chinese smartphones such as Xiaomi, Vivo, and RealMe and sees the maximum sale during the festive season. While the assembling of products happens in India, the components come from China and with the existing stock finishing, there won’t be a supply. With a slowdown on supply and almost predicting empty shelves on these online platforms, the festive offers may not make as much profit which would be affecting their overall performance. 

There is an anticipated factory closure in China for another 4-5 weeks. India’s trade with China is valued at around $9268 crore and total imports from China are around $5700 crore. Businesses hope that China’s advance efforts at containing the deadly virus and treating it would soon see results.