top of page
  • InduQin

‘China Covid situation not a concern for India’s electronics sector yet’

With Covid-19 cases rising in China and its financial capital, Shanghai, under indefinite lockdown, the Indian electronics sector is in a wait-and-watch mode. Though there has been no major impact on supply chains at present, the situation may change if the lockdown continues beyond two months, industry members said.

“There is some impact, but not something which can create a complete collapse. But it’s a dicey situation,” Pankaj Mohindroo, chairman of the Indian Cellular and Electronics Association, told FE.

The Indian industry is currently comfortable because manufacturing is taking place mostly outside Shanghai, and the city does not have many large companies in terms of the electronics ecosystem. In Shenzhen, which is an electronics hub, things are not normal, but since factories are mostly outside the city, they are well contained.

George Paul, CEO of IT hardware body MAIT, said, “As of now, there is no immediate concern raised. But it is also subject to how long the city will be shut down for. A certain period of shutdown should not affect the sector much, because buffer stocks are there. But if the shutdown goes on for a long time, there will be an impact.”

He said all companies have designed contingency plans, but they will be triggered only if the need arises. “As of now, things are in control. But we have to observe closely and take it on a day-by-day basis,” Paul said.

The industry is optimistic that given China’s zero Covid policy, the outbreak is likely to be controlled soon.

“The critical timeline would be somewhere around June-end. If things continue like this till June-end, it would be a matter of concern. Right now things are still a bit in control,” Faisal Kawoosa, chief analyst and founder, Techarc, said.

Some in the industry think this could prove to be a blessing in disguise, since the world has started seeing India in a different way when it comes to diversifying supply chains.

Mohindroo said, “The decision to keep manufacturing on during the second Covid-19 wave and after that, the resilience India has shown, is remarkable because other countries are not being able to do that, including Vietnam and Malaysia. India has come out with flying colours in terms of resilience of keeping the manufacturing and supply chains running.”


3 views0 comments


bottom of page