NEW DELHI: Indian electrical equipment and electronics industry has begun mass cancellation of orders on Chinese companies in the last few days and are scouting for newer destinations for raw material sourcing.
Companies are cancelling orders mainly for power distribution and transmission gears and turning to other countries despite higher costs. The process began in May after Prime Minister Narendra Modi’s vocal-for-local call. This month, the campaign intensified with restrictions on power gear imports but industry wants to make sure that the this does not create disruptions.
It also says the country needs to pool its testing facilities across sectors as there are few in power sector.
Indian Electrical & Electronics Manufacturers’ Association president R K Chugh said the industry was till now importing raw material, sub-assemblies and in some case finished goods too from China.
The association’s director general Sunil Misra said the industry is responding to its call of shifting to alternative sources as it is in their own interest to move out of Chinese supply sooner.
“In the intervening period towards 100% Aatma Nirbhar Bharat, we can shift to reliable and friendlier countries like Japan, Taiwan, Korea, Germany etc. Particularly software imports can be from Europe and Raw material from Russia, Czech Republic or Poland. Our members have already started reaching out to other countries for MoUs,” Chugh said.
Chandigarh-based EPC company Hartek Group in conventional and renewable power sectors recently cancelled orders on few Chinese companies for control panels and various state utilities also emphasising on shifting away from Chinese equipment. “We back the Prime Minister’s vocal for local call. These were approved vendors but we cancelled the orders recently. This may hit 2-3% of our bottom line. Hardships are bound to be there but if we don’t do it now, we will miss the bus.
We need to raise our quality standards as this a big opportunity,” company chairman and managing director Hartek Singh told ET.