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Corona outbreak hits industries dependent on Chinese parts

Companies have started sourcing products from other countries to continue their manufacturing without interruptions.

PTI|
Last Updated: Feb 18, 2020, 03.38 PM IST
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AURANGABAD: The coronavirus outbreak has hit industries in Maharashtra's Aurangabad district, a prominent manufacturing hub, with companies finding it difficult to procure substitutes for Chinese parts. Companies have started sourcing products from other countries to continue their manufacturing without interruptions.

"Aurangabad has more than 4,000 companies and some of them source parts from China. The coronavirus outbreak in China has disturbed the supply chain of materials," former chairman of Chamber of Marathwada Industries and Agriculture (CMIA) Prasad Kokil said.

The gap in the supply of raw materials can create problems, he said, adding that this is a chance to look for substitutes and decrease the dependency on Chinese parts.

The micro, small and medium enterprises can grab this opportunity, Kokil said.

Companies working in solar and energy sector have to import parts from China, solar and energy equipment manufacturer M P Sharma said.

"The production of solar items has been impacted, as the supply of raw materials from China has been disrupted. We have found new alternatives in Vietnam and Taiwan," he said.

"Imported parts make 60 per cent of our products. We need to buy them even if they are 13 to 15 per cent costlier than Chinese imports," he added.

One of the manufacturers who has invested Rs 3.5 crore in Chinese machines is unable to get his consignment, as he can't send anyone to transport the equipment from there, industrialist Sunil Kirdak said.

When asked if local MSMEs can profit from this development, Confederation of Indian Industry's zonal chairman Mukund Kulkarni said it would be highly unlikely as the parts will have to be delivered in a short span of time.

"We can make quality parts, but we may not be able to meet the demands in a short span of time. Hence, imports will continue, only the countries we import from will change," he said.
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