Consumer goods major (HUL) said it was looking to reduce the import from China for sourcing raw material and packaging material, amid border tensions along the Line of Actual Control (LAC).
“We do have imports from China worth Rs 429 crore, including raw material and part packing material. And we have an absolutely clear strategy, and have started working on what would be the possible alternatives,” HUL Chairman, Sanjiv Mehta said on June 30.
Mehta was speaking to investors at HUL’s 87th annual general meeting (AGM).
“During the COVID period, we have demonstrated a huge degree of resilience, and moved to alternative sourcing which will help us to mitigate any risk that might arise because of the present geopolitical crisis,” Mehta said.
There have been calls to boycott Chinese products after a clash on June 15-16 night at Ladakh’s Galwan Valley where 20 Indian soldiers died.
HUL’s plan to look for alternatives to China also comes amid the government’s ‘Aatmanirbhar Bharat’ plan, or push for domestically produced goods.
The 99 percent of the products sold by HUL in India are manufactured locally, Mehta told investors.
Mehta also said the risk of recession is real, and that the Centre should watch the demand situation closely.
“It is not easy for the government to have a large demand-led stimulus and it must be concerning the government that if they go down this route, a large part of the stimulus could end up as savings rather than being spent to generate demand,” Mehta said.