Due to the outbreak of covid-19 in different cities in China, there is a major disruption in the supply chain that resulted in increased freight rates. This affected India because India imports billions of goods from China every year.

 

India imports around 9 billion dollars worth of electronic components across sectors from China every year such as ED TV panels, speakers, cables, connectors, and more. But due to the recent outbreak of Coronavirus in China, there are disruptions in Lajpat Rai Market which are Asia’s biggest electronics wholesale market in Central Delhi.

 

In a recent interview with NDTV, Rakesh Arora, Vice-President of Central Radio and Electronics Merchants Association told about the consequences that India is facing due to disturbance in the supply chain. He told that there is a major difficulty in importing the goods from China as the freight charges got raised by 3 times and also shipping is not possible due to lack of manpower. He told that the prices of containers have gone up and the bulky goods such as LEDTv, panels, and more becoming costlier to the ship.

 

One of the traders in the market said, "Supply chain has been affected in the last 2 months. If we ask for 25,000 pieces of an item, we only get 5,000-7,000 pieces of it. In some cases, the factories are shut down. In others, the ports are shut or ships are not available."

 

India imported goods worth $97.5 billion from China in the calendar year 2021 with an increase of 46.1% from 2020. India's majorly imports from China include parts for electrical instruments, automobiles, smartphones, telecom, chemicals, and fertilizers.

India is highly dependent on  China for importing semiconductors. Semiconductors are important to power everything from smartphones to computers, advanced medical equipment, and modern cars. India's imports of automobile components from China account for 26%.

Many few countries like Taiwan and China make this semi-conductor. Last year, while everybody was at home the major consumption of semi-conductor was diverted towards the home appliances but afterward there remaining quota was consumed by the automobile sector.

 

There is a bit shortage of semi-conductors in the market that causes the delay in the delivery of cars to the customers.