India bans Chinese telecoms imports

[flanker30]

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[no_name]

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[deepak75]

Chinese craps flood Indian markets because Indians love the craps.

Indians can't even product the kind of craps that they love.

This is a simple, simple supply and demand in economics 101.

Which part of the above post contributed to the topic my dear senior member?

The quality of products in China can be very good and also the poorest. It just depends on what the customer is paying for it. However those customers who are seeking better quality products find that the cost for good quality products is very competitive or even better in Korea / Japan or even Europe when compared to China.

Hence the core competence of Chinese manufacturers is to produce very at a very low cost while being ready to totally compromise with the quality. This is also not a bad approach because there are enough nations where consumers are only being newly exposed to technology and there the cheap versions of Chinese goods can flourish.

Now tell me - why did you have to bring in such derogatory comments about Indians in this debate my "senior member".

General question for I am new: Are the member's posts rated qualitatiely while making them "senior memebers" or is it just the number of posts of any type that they put on the forum??

 

[below_freezing]

Which part of the above post contributed to the topic my dear senior member?

The quality of products in China can be very good and also the poorest. It just depends on what the customer is paying for it. However those customers who are seeking better quality products find that the cost for good quality products is very competitive or even better in Korea / Japan or even Europe when compared to China.

Hence the core competence of Chinese manufacturers is to produce very at a very low cost while being ready to totally compromise with the quality. This is also not a bad approach because there are enough nations where consumers are only being newly exposed to technology and there the cheap versions of Chinese goods can flourish.

Now tell me - why did you have to bring in such derogatory comments about Indians in this debate my "senior member".

General question for I am new: Are the member's posts rated qualitatiely while making them "senior memebers" or is it just the number of posts of any type that they put on the forum??

im not sure. there is both quality meter (thanks) and quantity.

 

[deepak75]

I think this strategy is likely to backfire simply because China has now become the factory of the world. Most American, European and Japanese companies also manufacture their computer and telecom gear in China.

Sir, different nations achieved industrialization in different periods. The idea is the current champion to have the most competitive cost of manufacturing at acceptable quality levels. So China was not always the factory of the world and will not always remain the factory of the world. It is only the current factory of the world. But any nation which tried to sustain the model of "factory of the world" collapsed eventually because of unsustainable growth on account of lack of internal consumption. The same is the case with China.

Now you corroborate my comment in your post itself. The reason why organizations have set up manufacturing in China is because it is a market.

Likewise India is a growing market for new products consumption. So the factories will come to India too. That is why I suggested to another Senior member on this forum that if China wants to do business in India over long term for its communications equipment then it should set up manufacturing in India and commit to the market.

 

[deepak75]

their telecom gear is still inferior to huawei and are manufactured in china anyways.

in fact, why don't we do this?

at least we have the technology that's able to be banned. why aren't we banning indian telecom tech in retaliation?

because there is no indian telecom tech.

why aren't we hitting them in other markets?

because india is not an industrial nation and has very few competitive products.

Actually that is not correct Sir. India is also an industrialized nation however the simple fact is that it is not an industrialized nation which has been able to achieve a surplus.

Now there are some sectors where you get beaten by India. Pharmaceuticals, R&D, soft skills, IT applications and development are some mere examples.

With this inhibition by GoI, India will also get the technology by way of local manufacturing hubs from international businesses. That is how Huawei or any other chinese organization got it.

This step is only to ensure that there is local growth on account of the increasing market and not just drain on forex and adverse current account. I am sure that China will understand this. They too completely discourage imports of any goods except those that are primary.

 

[below_freezing]

the thing is, except for pharmaceuticals india's most competitive industries are not manufacturing, but rather as you said "soft skills" that employ only a limited number of people and make it very hard to build up industrial expertise.

for example, to write a software program, you only need to know programming.

that is not the case for china. since we were sanctioned by the west, we had to develop everything on our own. for example, making a mere toy is actually a huge accomplishment industrially - automatic plastic molds, automatic cutters, painters, milling machines for metal parts, computers and programs to track inventory, etc. now magnify htis by every product china dominates in the market. it is definitely NOT easy and india still has a ways to go before it catches up, except in pharmaceuticals.

 

[SinoIndusFriendship]

the thing is, except for pharmaceuticals india's most competitive industries are not manufacturing, but rather as you said "soft skills" that employ only a limited number of people and make it very hard to build up industrial expertise.

for example, to write a software program, you only need to know programming.

that is not the case for china. since we were sanctioned by the west, we had to develop everything on our own. for example, making a mere toy is actually a huge accomplishment industrially - automatic plastic molds, automatic cutters, painters, milling machines for metal parts, computers and programs to track inventory, etc. now magnify htis by every product china dominates in the market. it is definitely NOT easy and india still has a ways to go before it catches up, except in pharmaceuticals.

Though it's admirable and understandable that India is using China as a benchmark for success, but they shouldn't under-estimate the immense collective hardship and effort on behalf of Chinese people. And please don't bad-mouth the quality and success of Chinese people.

It is a cold stark reality, but Indians need to open up their eyes. Take it one step at a time. For example, Indians should use the following as benchmarks - progressing up one level at a time:

1) Indonesia

2) France

3) Germany

4) Russia

5) Japan

6) USA

7) China

 

[below_freezing]

agreed, but the industrial power difference between indonesia and france is huge. in between there's stuff like poland, turkey, romania, etc.

 

[deepak75]

^^^^^^^^ yeah okay. Continue patting each other backs but look, China did not invent any wheel. There were license manufacturing agreements and TOT. That is why the manufacturing started. Why did the world have to invest?? Bcos there was not way in which the products could be imported in to China with the amount of regulation in place. So when Deng offered the opportunity, world accepted it and the rest is available for all to see in the progress in China.

But.... that was not done with the thinking that you both have shown above. In fact, nothing in the above mutually appreciative posts is relevant.

"For doing everything, one needs to know only something." So let us just leave that abstract thinking aside. The fact is that everything evolves and that is how progress is made. From basic manufacturing it goes to medium tooling and moulding and with more reserach automation and then thorough mechanization and then outsourcing (because there is tremendous depth in research and technology then available). That is actually why a lot of manufacturing was outsources to China before the reverse thinking set in to the current U.S administration. So stop counting these countries that you probably know nothing about economic evolution considering your above four/five posts.

India has the market and the skill and the resources and the purchase potential. Just to explain in the revelance on this thread, every country did not have to create a Mr. Graham Bell. People just use the phones and the developing technology that comes in making them work.

 

[Gene]

Indian govt has taken a good move by banning the Chinese counterfeit mobiles. But the problem is that, Govt is silent about who will gonna clean up the mess.....

 

[below_freezing]

we had ToT for 20 years:

1950-1960 from russia
1979-1989 from USA and europe

afterwards they sanctioned us. we were not allowed to import even digitally controlled milling machines because they can be used for military purposes. so we built our own, using the old russian milling machines but updated with computer automation.

india had it much better than us. they were never subject to a global sanction like we had in 1970's when both soviets and USA sanctioned us.

also, you have to get this across: the "outsourcing" for china and india are different.

the "outsourcing" for china is, the US company buys components made in china, by a chinese company, at a low price, then assembles it and slaps on their brand name (this is the part that makes huge profits; the actual manufacturing doesn't). but the actual manufacturing gives industrial expertise and experience in making things, as well as forces the country to make their own machine tools.

the "outsourcing" for india is, a US company sets up a call center. indian employees are paid by the US company, controlled by Americans, and answer calls, a routine service job that does not give any experience in design, innovation or scientific thinking.

 

[Speeder 2]

^^^ so true. that's what I have read about also.

For example, I know a guy ( Dad of one of my friends) from a German high precision industrial machinary manufactarer, who told me that they could export their machines ( hey have one of the top brands in the world) to almost anywhere in the world except a handful of sanctioned countries, such as China, Iran, North Korea at etc.

He said they've missed many golden opportunities to earn big bucks in those markets, particularly in China. The way as the things go, he said, China could catch up on world standard and fastly becoming one of thier potential competitors in the same market segments.

 

[deepak75]

we had ToT for 20 years:

1950-1960 from russia
1979-1989 from USA and europe

afterwards they sanctioned us. we were not allowed to import even digitally controlled milling machines because they can be used for military purposes. so we built our own, using the old russian milling machines but updated with computer automation.

india had it much better than us. they were never subject to a global sanction like we had in 1970's when both soviets and USA sanctioned us.

also, you have to get this across: the "outsourcing" for china and india are different.

the "outsourcing" for china is, the US company buys components made in china, by a chinese company, at a low price, then assembles it and slaps on their brand name (this is the part that makes huge profits; the actual manufacturing doesn't). but the actual manufacturing gives industrial expertise and experience in making things, as well as forces the country to make their own machine tools.

the "outsourcing" for india is, a US company sets up a call center. indian employees are paid by the US company, controlled by Americans, and answer calls, a routine service job that does not give any experience in design, innovation or scientific thinking.

You clearly got my understanding of the subject wrong. Let me put is more simply.

1. Yes indeed you have done very well since Comrade Deng's decision. Nothing is to take away from that fact.
2. The reason that you did well was because your discouraged imports and rather focussed on local production. That is the best way to create internal capability because by the end no "low entry - low exit cost risk" investment is good for an economy.
3. Outsourcing can be for anything. Even sub-contracting is outsourcing. any process that is being delegated to an external entity (not only another country, even another company) is outsourcing.
4. Manufacturing growth in China is a direct derivative of this phenomenon. Initial parts of exports growth was due to manufacturing of low tech equipment in China by interational organizations and source internationally from there.
5. Other factor which benefitted were your artificially regulated currencey (keeps exports cheaper and imports expensive) so encourages local production and kills competition. Also the lesser cost of manufacturing played its part and over the years local demand also shaped up.
6. The "slapping the brand" is also contract manufacturing and a way of outsourcing. The company commissioning the project to you uses its brand value and your lower cost of manufacturing to create more value for the shareholders in the same process versus other alternatives.
7. The "call centers" in India are also a business process outsourcing activity. The difference is that the out-sourced activity is not manufacturing but a non-physical process.
8. Considering the reasons of China's growth - refer to 1 - 5 - should be good enough for your analysis when you see that India wants to discourage imports of the equipment. Invest in India, make them here and do the business. Thanks for your time.

 

[deepak75]

^^^ so true. that's what I have read about also.

For example, I know a guy ( Dad of one of my friends) from a German high precision industrial machinary manufactarer, who told me that they could export their machines ( hey have one of the top brands in the world) to almost anywhere in the world except a handful of sanctioned countries, such as China, Iran, North Korea at etc.

He said they've missed many golden opportunities to earn big bucks in those markets, particularly in China. The way as the things go, he said, China could catch up on world standard and fastly becoming one of thier potential competitors in the same market segments.

The guy = Dad of your friend is very correct. The ban on the export of certain products and technologies could be due to the following reason:

Political = Iran & North Korea etc. due to external government restrictions.

Business worthy / Business continuity reasons = High risk of technology loss / patent violation. If the technology goest to another competitor the company is worthless and cannot draw fromt its investment and competency. This is an internal decision of the organization and is based on the business risk and ethics voilation estimation. Clearly the experience of international organizations in China has been such that they burned their fingers by providing their technologies to chinese company via license manufacturing / representation. Reverse engineering is a very scary word for international organizations with competencies of technology and reserach. Hence it is not only a ban on a sale but also part of the end user agreement that the equipment will never be exposed to the companies from China or resold to them.

So father of your friend will be your Uncle?? easy to relate I think.