No cause for panic for industry, trade; ASSOCHAM on Coronavirus impact

New Delhi, 22nd February 2020: There is absolutely no need for any panic, as the Indian industry and trade, including the pharmaceuticals, are readying to manage the evolving situation without causing any major impact on the supply chain, said ASSOCHAM Secretary General Mr Deepak Sood.

“Yes, in a highly integrated economy, global supply chain is a reality but there are adequate cushions available to deal with temporary disruptions. Both the Indian government and the industry have been reacting in a pro-active manner, in close coordination with each other, to face any economic, technical or even contractual impact of the Coronavirus on the world economy,” Mr Sood said.

“Thankfully, so far, there has not been any major disruption in supply chain on Indian industry and no major challenge is foreseen in the near term. ” the ASSOCHAM Secretary General said.

He said while it is true that India imports substantial amount of API (Active Pharmaceutical Ingredients) to the extent of 60-70 per cent from China, there are several domestic and global firms which have set up API units in India as well. Depending upon the evolving situation, they may be encouraged to ramp up their production in India. The NITI Aayog’s engagement with the pharma industry is directed at achieving the same objective.

For the long run, it is both an opportunity and a wakeup call for boosting domestic production of essential generic drugs along with APIs for the Indian and global market.

When it comes to other industries like electronics, there are no immediate threats. However, alternative supply source like Taiwan can be explored. Again there has been an increased focus on domestic production of IT hardware and electronics and the initiative like ‘Assemble in India’ can be ramped up,” Mr Sood said, adding that the ASSOCHAM is in constant touch with its members , keeping a close watch on the situation.

”We should not get very negative on sporadic headlines reporting disruptions. Such events have to be tackled pragmatically. It is commendable for the Government to have clarified that in such events, the companies can invoke clauses like Force Majeure and protect themselves against any contractual lapses, if any, should a situation so demand.”