Tensions between China and India are spreading to global business.

This week, trade organizations said Chinese shipments were suddenly held up at Indian checkpoints, highlighting mounting tensions in a vital trade relationship after countries clashed in a deadly border battle more than a week ago.
The India Cellular and Electronics Association (ICEA), which represents Apple (AAPL) and Foxconn, among other companies, complained to the Indian Finance Ministry on Tuesday that all Chinese electronic imports were being examined at Indian ports “without notice.”

“There was a rejection of the approval, followed by delays, and now, let’s talk about the review at 100%,” ICEA President Pankaj Mohindroo wrote in a letter to the ministry. “The logistics of continuous movement are in complete disarray.”

The time is especially stressful because companies have already suffered from production problems and other outages due to the coronavirus pandemic, Mohindroo noted. He estimated that the sector “has only recovered to less than 40% of normality.”

“In normal dispensing, products are automatically shipped without examination,” wrote Mohindroo. “We have just started to return to normal after a series of massive losses over three months, and now this.”

The finance ministry declined to comment to CNN Business on the letter.

India suspends three trade deals with China as border tensions escalate

Other business organizations are also concerned. The Chennai Association of Customs Brokers, based in Southeast India, said Tuesday that authorities have been instructing freight operators across the country “to keep all shipments originating from China.”

The shipments are now expected to be “held and re-examined prior to release,” a group representative wrote in a notice to members. While there has been no official notice about the new practice, the association warned companies that there may be delays in cargo clearance at ports, airports, and customs stations across the country.

Before last week’s border skirmish, growing anti-China sentiment in India had already prompted a boycott of Chinese goods and services, while new rules on foreign investment were expected to limit China’s ability to capitalize on India’s Internet boom.

Then the fight at the border occurred. Twenty Indian soldiers died in the violent exchange, sending China and India into a tense diplomatic and military confrontation.

The economic stakes are high. India imports more products from China than any other country. And India and China have allowed each other to rise as technological powers.
China and India need each other.  Just look at the technology
In another sign of frayed ties, local authorities in India announced this week that they were coming to a pause of more than $ 600 million in deals with Chinese companies, including one with automaker Great Wall Motors.

A Maharashtra state minister said officials were waiting for the central government of India to assess the current business climate and announce a clear policy on how to advance agreements with Chinese companies.

Anti-Chinese boycotts

On Thursday, some hotels in New Delhi announced that they would reject all Chinese guests due to the international dispute. The move may be largely symbolic, given that the Covid-19 pandemic has severely restricted travel between countries.

“We have … decided not to give way to any Chinese citizen at a time when China is repeatedly attacking our valiant Indian forces,” Mahendra Gupta, secretary-general of the Delhi Hotel and Restaurant Owners Association, wrote in a statement. letter to another business organization.

The group also promised to stop using “any Chinese product” in its business and threatened to contact “hotel associations in other states to make similar decisions.”

It is not the only organization that has intensified its rhetoric against China.

The Confederation of All India Merchants (CAIT), an organization representing millions of small physical stores, also urges Indians to boycott Chinese goods.

Police detain an Indian merchant who was burning Chinese products during a protest in New Delhi on Monday.

Last week, the group released a list of more than 3,000 products made in China that it wants consumers to abandon. The goal of the campaign, he said in a statement, is “to reduce India’s dependence on China for these goods.”

The organization has also asked dozens of business leaders from across the country to join the campaign, including Mukesh Ambani, the country’s richest man. Ambani conglomerate Reliance did not immediately respond to a request for comment on Friday.

CAIT activists are putting pressure on online shopping companies in India to start showing the “country of origin” of products sold on their portals, calling it a “crucial element” in their campaign.

CNN’s Manveena Suri, Esha Mitra, Swati Gupta, Rishi Iyengar and Sherisse Pham contributed to this report.