India needs integrated approach to secure supply chains and reduce import dependence
Anant Goenka's article emphasizes India's deep embedding in global supply chains and its vulnerability to disruptions due to heavy reliance on imported raw materials and intermediates. He highlights critical sectors like energy (85% crude oil import), food (edible oils, pulses, fertilizers), and manufacturing (electronics, pharmaceuticals). The article advocates for long-term resilience through diversification, domestic capacity building, and technological transition. Key strategies include accelerating renewable energy, expanding domestic oil/gas exploration, buffering strategic reserves, promoting crop diversification, reforming the fertilizer sector, and deepening domestic manufacturing of intermediates, especially APIs and semiconductors.
Key Points
- India's manufacturing ecosystem is highly dependent on imported raw materials and intermediates, making it vulnerable to global supply chain disruptions.
- Critical sectors like energy, food, and manufacturing (electronics, pharma) face significant import dependence, impacting inflation and economic stability.
- Securing supply chains requires a multi-pronged approach including accelerating renewable energy, expanding domestic resource exploration, and building strategic reserves.
- Deepening domestic manufacturing of intermediates, such as APIs and semiconductors, and diversifying import sources across regions are crucial for long-term resilience.
Exam Facts
- India imports about 85% of its crude oil and over 50% of its gas.
- India aims for 500 GW of non-fossil capacity by 2030.
- Raw materials constitute 34% of India's imports, intermediates 31%, and capital goods 24%.
- India imports nearly 65-70% of its pharmaceutical intermediates from China.
- Anant Goenka, President of the FICCI, is the author.
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