Origin of Everything ?

Ever since Albert Einstein published his  “ Theory of Relativity “ , scientists around the world have been wondering :

 Could there be a “ Theory of Everything “ ?

From time to time, some scientists have even postulated such theories. But no validation so far !

Bureaucrats in our Ministry of Commerce are currently engaged in a later-day version of this elusive quest to come up with, a theory on “ Origin of Everything “

For each item being sold online in India, they want the seller – and the online platform – to declare its “ Country of Origin “

Not an easy thing to establish, as following news report says :

India faces thorny question of how to determine “ Country of Origin “  /  27 July 2020

Extract :

Unlike the EU or US, India does not have rules to determine what is meant by “ country of origin “ for purposes of Indian law, other than for the purposes of FTAs.

If the goods contain,

Ø  raw materials from Country A,

Ø  are assembled in County B, and

Ø  manufactured in Country C,

which is the “ country of origin “ ?

Most jurisdictions lay down a percentage of value-added as a kind of marker

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 4 YEARS ago, I sent following email to Cabinet Ministers :

Missing the Woods for the Tree ?    ………………………………………………..[ 12 Aug 2016 ]

Where I wrote :

Entire cycle of Designing / Manufacturing / Marketing / Selling / Order-taking / Delivering / After-sales Servicing / Logistics / Collecting Payments / etc , will get spread so thinly across Countries / Continents / Companies / Individuals , that it will become next to impossible to keep track of " WHO " is adding " WHAT " value to the process , and " WHEN " , and from " WHERE " !  

No one will be able to unravel this GORDIAN KNOT

    

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Then 2 YEARS ago, I sent following email :

E Commerce Definition : a Space Ship ?   ……………………………………….[ 05 July 2018 ]

 

Where I wrote :

 

And , as far as defining what is “ Made in India “ is concerned , I believe , government goes by “ Percentage of Value Addition “ locally

But , this is a very difficult and time-consuming exercise

Even when possible, its result hold good for a very short period in a dynamic situation

A manufactured “ local product “ could have hundreds of components ( both, local and imported )

And those “ local components “ could have “ imported “ raw materials or intermediates

These days , a product could be,

 *  patented in one country ( concept )

*  designed in another country

*  developed ( detail manufacturing drawings  ) in another country

*  components made all over the World

*  Sub-Assemblies ( of those components ) carried out in another country

*  Final Assembly done in another country

*  Packaging done in another country

*  Offered for sale on ONLINE e-commerce portals in another country

*  Marketed by agencies located all over the World

*  Delivered using manpower / drones / supply chains of several countries

*  Financed by funds from all over the world

At which “ Level  “ of Value Addition , does a product become “ local “ ?

And if I download a " Product Drawings / Design " over the internet and then " 3D Print " it in my garage ( using " imported " resins ) , then is that a " local " product ?

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Then , a month back, I sent following e-mail :

Autobiography of an Appliance   ………………………………………………………[ 22 June 2020 ]

 

Where I wrote :

 

How much “ Value Addition “ ( as a percentage of total cost of production or selling price ) should take place in India, to qualify an appliance for “ Made in India “ tag ?

I am unaware of any official / authentic definition

To get a clear picture of how “ Value Additions “ take place in a chain of countries , before an appliance gets delivered to your home, consider the following ( over-simplification ) :

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   Value-Addition is a Many Splendored Thing – in today’s Global Supply Chain

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PROCESS STAGE	OUTPUT ( at each stage of Process )	Country supplying Inputs to Processing Country	PROCESSING COUNTRY ( where value addition takes place using local manpower )	INPUTS at each Stage ( Value Addition )	MANPOWER COST as % of final total cost ( Value Added )
1	Iron Ore		India	Manpower	5 %
2	Ingots	India	Australia	Manpower	10 %
3	Bars	Australia	China	Manpower	10 %
4	Components	China	Indonesia	Manpower	10 %
5	Sub-Assy	Indonesia	Singapore	Manpower	25 %
6	Assembly	Singapore	South Korea	Manpower	30 %
7	Packaging and Dispatch	South Korea	India	Manpower	10 %
				TOTAL	100 %

Obviously the scenario described above is an “ Over Simplification “ considering that , at each “ Stage of Processing “ ( in a given country ) , “ Inputs “ may come from many other countries ( not just one country )

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Related Reading :

 

SC agrees to hear plea for display of ‘Country of Origin' on products on e-commerce portals 

Petitioner :  Divya Jyoti Singh  /  divsjs@gmail.com

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India is a mobile phone exporter now, but can it mute the Dragon ring tone?    /  10 June 2020

Extract :

Ø  High export of mobile phones doesn’t mean they are being produced entirely here. According to the India Cellular and Electronics Association, mobile phone manufacturing units in the country have grown from just two in 2014 to 268 in 2018. But a deep dive into the data shows that more than being made in India, cell phones are mostly assembled in India

Ø  This is evident from the fact that despite having such a big number of factories, India’s value addition to mobile phone manufacturing has been hardly 10 per cent on an average as a Credit Suisse press release notes

 

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With regards,

Hemen Parekh  /  hcp@RecruitGuru.com  /  27  July  2020