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Why India won’t retaliate against China

India and China’s growing trade and commercial relations have not been complicated by border disputes for decades.

But China’s killing of 20 Indian troops this week in a Himalayan border altercation could force Prime Minister Narendra Modi to impose retaliatory sanctions a popular outrage and political pressures mount for a firm response.

India’s imports from China grew to US$70 billion in 2019, a massive leap from the $1.3 billion received back in 2000. Modi’s government could conceivably order Indian companies to restrict Chinese investment and urge citizens to avoid Chinese products.

But China’s hold on various Indian markets with low-cost products means any such move will hit the Indian consumer at a time the economy is already in dire straits due to the coronavirus crisis.

After China’s surprise attack, where at least 20 Indian troops were killed with crude weapons and even rocks, Modi’s government is now moving to restrict the use of Chinese equipment and technology in sensitive areas.

Media reports suggest that restrictions could be extended to other state-run and private companies, as well as on imports of non-essential items.

The government has told state-owned Bharat Sanchar Nigam Ltd not to use Chinese equipment in the modernization of its 4G facilities, the Economic Times said. It is also considering tweaking rules to discourage the use of Chinese-made telecom equipment by private operators.

With more than a billion subscribers, India is the second-biggest mobile phone market worldwide. Most use more data than communications. The growing digitization of processes across industries is becoming critical for economic growth, and Indian companies are rapidly preparing for the next generation of systems.

Yet the market is dominated by Chinese smartphone makers such as Xiaomi, Oppo and Vivo, who sell the fastest-selling models. The share of Indian phone makers such as Micromax, I-Ball and Lava has shrunk over the years, as has that of Samsung and the erstwhile global leader Nokia.

A Xiaomi Redmi Note 7 Pro smartphone. Chinese phones are widely used in India. Photo: Imaginechina/AFP

Indian intelligence has red-flagged 52 mobile apps with links to China, the Hindustan Times said. The list includes video conferencing app Zoom, short-video app Tik-Tok and others such as Xender, SHAREit, Shein and Clean-Master.

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