India is Seen as the New Destination for Global Supply Chain Expansion and Investments ! ????

Global value chains are evolving rapidly due to geopolitical tensions and the pandemic, prompting a need for resilient supply chains and robust national security measures. Countries like Japan and Taiwan are reconfiguring their strategies to diversify and strengthen their supply chains, with India emerging as a key player.

Japan's "China Plus One" strategy, initially proposed in 2005 (initially look warm) has gained significant traction in recent years. The Japanese government, supported by US collaboration, is heavily investing in the semiconductor sector and expanding its supply chain footprint in Southeast Asia, India, and Bangladesh. This initiative aims to mitigate risks associated with over-reliance on China and capitalize on emerging markets.

Similarly, Taiwanese firms are shifting their supply chains from China to India, spurred by a near doubling of Taiwan's FDI in India from 2018 to 2023 compared to the previous decade. A notable investment includes a semiconductor fabrication facility in Gujarat, in partnership with Tata Group, supported by a $10-billion incentive scheme. Taiwan's focus extends to mobile phone assembly and footwear industries, further embedding itself in India's manufacturing landscape.

Union Minister of Commerce and Industry, Piyush Goyal, attended the G7 Trade Ministers' meeting in Italy, where he engaged in high-level bilateral talks to bolster India's global economic partnerships. Goyal emphasized the importance of building resilient supply chains and proposed collaborations in critical sectors such as semiconductors, pharmaceuticals, and green energy. His efforts have prioritized strengthening trade partnerships with Italy, the EU, the UK, and New Zealand. He addressed the impacts of the "3 Cs" (Covid, conflicts and climate change) on global value chains.

These developments underscore India's growing role as a major hub for global investments and supply chain diversification. The country's strategic location, robust infrastructure, and favorable business environment make it an attractive destination for international firms seeking to mitigate risks and enhance their global operations.

Why Countries see ease of working with India

• Strategic Location: India’s geographic position makes it an ideal hub for regional and global trade.
• Skilled Workforce: A large pool of skilled professionals and labor force.
• Government Support: Proactive government policies and incentives for foreign investments.
• Robust Infrastructure: Improving infrastructure to support large-scale manufacturing and logistics.
• Favorable Business Environment: Simplified regulations and a business-friendly environment.

India's proactive stance and strategic collaborations position it as a pivotal player in the reconfiguration of global supply chains, attracting significant international investments and fostering robust economic growth.

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Reference:

• The Statesman
• Reuters
• Control Risks

#GlobalSupplyChain #India #Trade #FDI