The Coronavirus pandemic is forcing global companies to diversify their manufacturing away from China to other emerging and frontier markets. This pivot became particularly urgent since the outbreak of COVID-19 wreaked havoc on China-based supply chains, exposing the world’s over dependence on China. The supply shock has hit corporate revenues hard due to lost output, sparking  a recession.

Dependence of the World on China

• China was already producing half the world’s medical masks even before the pandemic spread; 
• It’s also a major source of pharmaceuticals and protective equipment at a time when countries around the globe are experiencing shortages.
• Where USA dependence is nearly 93% and India is of 63% for API (Active Pharmaceutical Ingredient).
• “The world is dependent on China for manufacturing,” say for example on U.S.-China supply-chain about electronics, textiles, furniture, toys, and a lot more, adding up to about half a trillion dollars in imports.
• France, like the U.S., is deeply reliant on Chinese supply chains, not only for medical equipment needed to cope with the coronavirus, but for its pharmaceutical and auto industries too.
• Growing dependence on China has been a source of discontent in Britain since even before the coronavirus emerged.Earlier this year, britain govt.  gave the Chinese telecom giant Huawei permission to build part of Britain’s 5G network despite concerns that it could pose an intelligence risk and make Britain technologically dependent on China.

The US-China rivalry

• The US-China rivalry will remain the core issue, with several other regions and nations aligning with the one who can bring them short to medium-term advantages.
• Contingent upon how badly the US is finally affected, its current confused leadership is unlikely to inspire and its efforts at internal stabilisation may compromise US power.
• A major turn in political fortunes in the US and its bumbling on pandemic management could throw open opportunities for others to exploit.
• The US will perceive itself far more insecure than it was even after 9/11.

Situation in China

• China is not a market economy, they don't play by the rules and Economic consideration would no longer will be the sole consideration.
• As per IMF estimates China will go around 1.2% this year and Oxford Estimate its growth to 4.2%.
• The Unemployment rate in China is nearly 24%,
• Supply chains go down like food beverages and tourism sectors and there is substantial fallen of their both manufacturing and non-manufacturing.
• In crux China seem to forget that he has second largest piece of Economy.

Challenges face by World after moving from China

• The point of shifting the manufacturing hub outside the China to diversify risk needs to a seem who are the competiting things for example after this move the import bills of the countries would rise substantially.
• Subject to the US’s economic capability after the pandemic, the ability to find a consensus to put on hold defence spending for the sake of human security will be the key. But the trust deficit between nations will probably hamper this to a great extent.
• The key anchor of globalisation — the US-China trade relationship — will change even more.
• China cannot be replaced by the US as a major industrial producer (even for the US market).
• Other countries or blocs — ASEAN, Bangladesh and India — will all chip in but that will still not be enough.
• Nor can any country buy as much grain from the US as China does.
• So, an economic relationship will continue but will be politically fractured as both parties search for alternatives, which don’t exist on a scale that both of them need.?

Opportunities for India

• India without recession: Economically hit but probably one of the few nations without a recession, India’s strong central leadership could be a big advantage.
• International cooperation: Prime Minister Narendra Modi would need to use all his influence to cobble together international cooperation to pull the world from the abyss it could sink into.
• His credibility is already higher than most international leaders and could spell a leadership role for India not in conflict with China but in cooperation with it.
• It is India’s established multilateral foreign policy that could eventually come to the assistance of the world.

Road Ahead

• There is need to construct regional basis economy to counter China hegemonistic position for example like minded countries will put in Quad++ which have common agenda.
• India has to come out with some policy announcement like we have some levy in terms of Skill India, Digital India campaign but we need for acquiring economy for this format.
• Immediate resolution to South China sea issue is given us the stance that how countries reaching out an equilibrium decision.
• Therefore, Successful and swift recovery of the world hinges on international cooperation among the nation. This provides India with an opportunity to stitch together international cooperation in dealing with the aftermath of the crisis.