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The PHD Chamber of Commerce and Industry (PHDCCI) in its report has said that increasing domestic production in sectors such as chemicals, automotive components, drug formulations and consumer electronics will help in reducing imports worth about $35 billion from China in the coming times. It said that in recent years, imports from China have increased significantly and it was about $87 billion in 2021.

According to the report, India holds the immense potential to reduce 40 per cent imports (around $35 billion) from China in the coming times as there are various product categories which India also produces but at a lower volume. Imports from China have changed from low-value, low-cost products like toys and crackers to high-value items like electronics. India has significant scope for producing more import substitution in the sectors, including chemicals, bicycle parts, handicrafts, cosmetics and leather-based goods.

The report further said enhanced production in these sectors will not only reduce imports from China but also boost India's exports. It also said that since the domestic market has production capabilities; these sectors can readily minimize their dependence on China in a phased manner without any substantial extra investments.