InvestorQ : Do you see India being the big beneficiary of US and other Western companies moving their factory facilities out of India?
shrinidhi Rajan made post

Do you see India being the big beneficiary of US and other Western companies moving their factory facilities out of India?

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Riya Dwivedi answered.
1 year ago
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You are right that a number of companies around the world are planning to shift their factories out of China and a good number of them have already done so. The outbreak of Coronavirus from China will accelerate this shift. But data is not encouraging for India. As per a study by Nomura Group, out of 56 companies shifting production out of China, only 3 relocated to India while 26 went to Vietnam, 11 to Taiwan and 8 to Thailand. Ironically, Vietnam is a Communist nation with a long coastline and cultural similarity to China. Global companies prefer autocratic regimes as there is no bureaucratic lethargy and red tape. Vietnam has worked smarter in the sense that it minimized red tape, invested heavily in infrastructure, primary education and primary health. According to Nomura, an average Vietnamese is more skilled than an average Indian due to the skill-based education system. Clearly, India has big strides to make if it has to take a share of Chinese manufacturing.

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