JOIN USCoronavirus: Low-cost automobiles, garments, IT services likely post-COVID-19 crisis, says study
The rise in demand for agricultural products, low-cost automobiles, garments and consumer durables in other developing nations may expand export opportunities for India Inc. when the economy ravaged by the Covid-19 crisis will start getting back to the track, according to an assessment by the Ministry of External Affairs (MEA).
With the government focusing on bringing the economy back on track, the MEA got an assessment conducted on the impact of the Covid-19 crisis on the prospects of India Inc. abroad as well as the opportunities and the challenges emerging from it. The assessment was carried out on the basis of inputs received from India’s Embassies and the High Commissions in foreign capitals.
Foreign Secretary Harsh Vardhan Shringla shared the findings with the Federation of Indian Chambers of Commerce and Industry (FICCI) during a webinar.
“A large number of our missions (embassies and high commissions) have reported that there is a significant market for food, agricultural products and expertise in food-processing industries. Indian automobiles, particularly low-cost automobiles, including two and three-wheelers, will have an augmented market in developing countries,” said Shringla.
The assessment by the MEA predicted that that textiles, garments and consumer durable industries would have export opportunities as many markets would look to diversify their sources of supply.
“Indian e-commerce, IT (Information Technology) and IT-enabled service industries have also demonstrated that they can work through a crisis of this magnitude. These are obviously the businesses of the future,” Foreign Secretary said. “(The) digital highways can be used to leverage our higher education capabilities through tele-education onto a much larger market.”
The assessment carried out with inputs from New Delhi’s diplomats around the world found that cooperation in healthcare – pharmaceuticals, basic research, development of vaccines, diagnostics, devices, tele-medicines, hospital administration, healthcare supplies and expertise – with other countries is a major opportunity for India.
“This (healthcare) is an area where India has the ability to be a bridge between the developed and developing world and facilitating a two-way flow of information, products and expertise. It has institutions that can be seamlessly plugged onto class-leading global healthcare systems,” Shringla said, adding: “These institutions are also able to facilitate the flow, in the other direction, to our development partners.”
The MEA also suggested that investments in Ayurveda and Yoga now could find a market abroad.
The Covid-19 virus was previously unknown before the outbreak began at Wuhan in China in December 2019. The lockdowns enforced by nations to contain the pandemic had a devastating impact on the global economy and fuelled speculation that many international companies might seek to diversify global supply chains to lessen reliance on China.
Shringla, who took over as Foreign Secretary just a few weeks before the Covid-19 hit India, said that the ministries and the other agencies of the Union Government were already working out a strategy to ensure that the country emerged as an alternate manufacturing destination of choice for global investors.
“The idea behind this initiative was to enable manufacturing and trading companies looking to diversify and de-risk their value chains to choose India as an alternate location for their operations,” said Foreign Secretary. “To speed this up, we are looking to address several bottlenecks and usher in reforms which would make Indian industries competitive and help them match up to the global standards of production.”
He underlined that a major economic opportunity for India would arise from the drive to diversify global supply chains. “The attractions of investing in India are obvious. It is a major opportunity and needs to be grasped,” added the Foreign Secretary.