Brace for impact: Zoho’s Sridhar Vembu warns India of Chinese onslaught, suggests how to navigate Trump-era uncertainty

With global trade tensions rising again, Zoho founder Sridhar Vembu has warned that India must prepare for a fresh wave of cheap Chinese goods. He said, “We will face an onslaught of Chinese goods... navigating this will be a huge challenge.” Vembu laid out a seven-point plan to protect India’s economy and build long-term resilience in a post-globalization world. His message comes as Donald Trump threatens new tariffs and China looks to export its industrial overcapacity.

In a post on X, Vembu urged policymakers to focus on food and energy security, boost local manufacturing, and promote rupee-based trade settlements. He called on India to take decisive action to safeguard its economy and also help other nations in distress.

1. Secure food supply, support others in need

Vembu said food security must remain India’s top priority. “Thankfully India is self-sufficient in food and we must safeguard our food security,” he said. But he also stressed that India should grow more to support poorer nations that may face worsening food shortages. “That is our dharma as Bharat,” he added, citing India’s vaccine outreach during the pandemic as a model for global support.

2. Tie food to energy, invest in sustainable farming
“Energy is food,” Vembu said, noting that farming depends on fossil fuels for fertilizers and machinery. While India has strong energy ties today, he said the country must invest in long-term sustainable farming. His suggestions include research in water use, ecosystem management, electric farm machines, and private training farms.

3. Prepare for China’s export pressure
According to Vembu, China’s current export push is driven by domestic overcapacity. “China is not engaging in commercial aggression out of strength, but desperation in the face of massive overcapacity,” he said. One way to counter this, he suggested, is negotiating to pay for Chinese imports in rupees. “That may also push their companies to buy from us.” Vembu also proposed renegotiating external debts in rupees to increase India’s export competitiveness.

4. Launch a 3–5 year factory sprint
Vembu said India needs a focused effort to scale up manufacturing. “We need a 3-5 year sprint to build factories everywhere,” he said. He called for policy measures to encourage importers of foreign goods to make products in India. To speed up this shift, he recommended allowing 100% first-year tax write-offs for factories in underdeveloped districts, and 50% write-offs elsewhere.

5. Import only capital goods
India should limit imports to machinery and equipment that support production. Consumer goods should not be the priority, Vembu said. “And negotiate to pay for those capital goods in rupees,” he added.

6. Push private R&D investment
To drive long-term innovation, Vembu said India should aim to raise its R&D spending to 3% of GDP in the next 5–10 years, led by private firms. He proposed a “CSR-like obligation” for private companies to invest in research and suggested fast write-offs for related capital expenses.

7. Share innovations globally
Finally, Vembu urged India to share knowledge and innovation with other nations. “They do not have the vast human resources to invent that we do,” he said. “When we start inventing, we must share rather than hoard. That is the only way to a more just and more stable global order. That is our dharma as Bharat.”