The Shifting of Big Companies From China To India

INDIAN +ve Times 

Over the past two decades, China has served as the global production hub for companies in multiple industries, such as electronics, textile, medical devices, and automotive. The key factors have been the high availability of raw material, technological innovations, business-friendly laws, and accessibility to skilled labor. ​​​However, the scenario changed in 2019, when increasing cost of labor, as well as tensions created by the US-China trade war, clouded China’s perception as a favorable production center.

Will Corona Be a Good Pandemic for Indian Economy?

While India eagerly looks to court companies wishing to shift out of China, it may not actually be in the best interest of the country even if these companies make investments in India. “China is being blamed now for the coronavirus outbreak. Even people are saying that India stands to benefit as businesses will shift from China and come to India. But that may not be true,” Nobel laureate Abhijit Banerjee said speaking to a Bengali news channel ABP Ananda on Monday evening, PTI reported. Giving a hypothetical example, the MIT professor said that in the case that China depreciates its currency, Chinese products will become cheaper and preferable to buy. 

“What happens if China depreciates its currency. In that case, Chinese products will be cheaper and people will continue to buy their products,” he said. Abhijit Banerjee is a member of Global Advisory Board formed by the West Bengal state government to tackle COVID-19 in the state. In the past few weeks, companies have shown interest in opening further manufacturing facilities in south east Asia and also in relocating their factories out of China due to coronavirus. Several Indian states have also started proposing terms and have made lucrative offers to woo these foreign companies to their respective states. 

“There are opportunities for India to try to gain a place in global supply chains, but this will require serious investments in infrastructure and governance,” said Paul Staniland, an associate professor at the University of Chicago who writes about India’s politics and foreign policy. “India faces tough competition from elsewhere in South and Southeast Asia.”

Read more at:https://economictimes.indiatimes.com/news/economy/foreign-trade/india-looks-to-lure-more-than-1000-american-companies-out-of-china/articleshow/75595400.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

*So here is the list of conformed companies that are shifting their bases to India :-

The companies include Lockheed Martin, Adobe, Honeywell, Boston Scientific and Cisco Systems as well as global delivery services providers like UPS and FedEx. Several companies expressed their interest in leaving China and are looking for other investment destinations, including India.

China currently has a number of companies from the United States, Europe and Japan who are looking to shift plants or open additional units. India is also reportedly preparing a land pool nearly double the size of Luxembourg to woo investors, Bloomberg reported unidentified sources as saying. This land includes the already earmarked industrial area in states such as Gujarat, Maharashtra, and Andhra Pradesh.