Will Modi's Moves Lead to the 'Next China'?
December 1, 2020
COVID-19 taught global manufacturing companies the dangers of depending on any single country for their operations. Multinationals are reviewing their global footprints and diversifying away from China. Is India the first step?
Indian Prime Minister Narendra Modi has recognized that India has many of the attributes that made China successful, such as low-cost and abundant labor, technical and engineering excellence and growing domestic consumption led by an emerging middle class. The factor that has been missing has been investor- and business-friendly policies, but Modi is aggressively addressing this shortcoming, and is in hot pursuit of global manufacturing FDI. He has been aggressively pitching India as the next manufacturing hub. India is positioning itself for restructuring of global supply and value chains in the post-COVID-19 world.
It’s beginning to work. The large and growing domestic market, increasingly transparent policies and improving tax regime, labor supply and cost competitiveness and infrastructure improvements have put India on manufacturing investors’ radar screens. India can no longer be ignored.