[blackwasp]

The government in April reached out to more than 1,000 companies in the US and through overseas missions to offer incentives for manufacturers seeking to move out of China, according to Indian officials who asked not to be identified, citing rules on speaking with the media. India is prioritizing medical equipment suppliers, food processing units, textiles, leather and auto part makers among more than 550 products covered in the discussions, they said.

India expects to win over US companies involved in healthcare products and devices, and is in talks with Medtronic Plc and Abbott Laboratories on relocating their units to the country, an official said. Medtronic spokesman Ben Petok and Abbott spokeswoman Darcy Ross didn’t immediately respond to emails seeking comment.

Both Medtronic and Abbott have a presence in India, which may make it easier for them to move their China supply chains to the country, according to an official. They’re based out of financial center Mumbai and already work with large Indian hospital groups.

Officials have told companies that India is more economical in terms of securing land and affordable skilled labor than if they moved back to the US or Japan, even if overall costs are still higher than China. They have also offered an assurance that India will consider specific requests on changes to labor laws, which have proved a major stumbling block for companies, and said the government is considering a request from e-commerce companies to postpone a tax on digital transactions introduced in this year’s budget.

Source

[ValarMorghulis]

Well I hate to sound cliched when I say "Chaos is a ladder" but I sincerely hope this brings a ton of manufacturing jobs to India. With our stronger IP protection laws and aversion to blatant copying of western products, I hope companies abroad see that we can be a fabulous manufacturing hub!
Plus this can help develop tier-3/4 cities in to next metro cities.

Fingers crossed.

[AnandB]

Isn't the main reason many don't choose India is because of issues (mainly local) after they have setup in India? Vodafone retrospective tax and the Kia news a couple of months back for example?

[HKap]

This isn't as easy as we think. I suspect there will be a lot of political mud slinging and violence to project India as an unstable place and not an investment destination. It's almost building up to a storm. The govt is aiming to go after the left wing extremists and China will not make it easy. There will be a lot of funding for keeping the country on the boil . A lot of negative press in the left leaning media, both local and global. Fasten your seatbelts. The next 3 years are going to be rough.

[Avenger_123]

While I understand the anti-China sentiment globally, we should understand China has come a long way from being a global cheap labor sourcing destination. Manufacturing is changing globally with increased automation and AI, and soon cheap labor will not be the USP it used to be. Infact in cheap labor we will be competing now with Bangladesh/Vietnam etc.

China has invested massively in becoming a major consumer of the world, increased investment in education/patents and latest tech. In fields of 5G, automation, electric cars, electric aircraft etc. they are giving USA a tough competition and that is why there is increased anti-China push from USA. No western country can sustain without China market whether Apple or Tesla they are so big.

India is far behind that curve, we do not have leaders who can push relentless growth. The current administration unfortunately I believe just manages headlines and with all the religious intolerances western countries will be wary. There is no investment in changing education/innovate/research etc. that is the fundamental challenge we have.

Whenever new tech/change comes there is opportunity for disruption and I believe this is once in a century opportunity which we can capture.

Government should empower private companies, give research projects, focus on improved patents, reward innovation and encourage entrepreneurs.

The USP's we had our last two decades might not last much longer, with increasingly right-wing conservative governments, the push to bring everything in house is huge. Imagine if US government gives you incentieve to bring back jobs why will you go outside? In my current organization here in US, they have brought lot of manufacturing jobs back after Trump, we get lot of tax benefits and infact most R&D expense is reimbursed for defence tech, including traning college grads. This is great for companies to innovate at minimum risk. I see similar things in Europe & China, we as a nation have to demand this from our leaders for the next generation jobs, with tightening visas what are the future jobs for our kids?

[kiku007]

"out of the frying pan (and) into the fire". I guess that's how skeptics in those 1000 companies would be looking at the offer.

Coincidentally I came across the below content in the book about "Alexander the great".

"The merchant rulers of Tyre did not particularly care if Alexander or Darius won the war. They wanted only to maintain their very profitable trading dominance in the Mediterranean as they had for over a thousand years, with as little outside interference as possible."

I think that's very relevant for businesses even today. They want to maintain their dominance on profitability. I don't think India is a safe sanctuary that'll help businesses achieve that by moving away from China. Far from it.

[sharktale]

Originally Posted by kiku007

Attachment 2003081

"out of the frying pan (and) into the fire".

News Article (MoneyControl) : UP govt okays ordinance to exempt various industries from labour laws for 3 years

"The decision to approve the ordinance was taken on Wednesday in a Cabinet meeting chaired by Chief Minister Yogi Adityanath. A government spokesperson said on Thursday The step aimed at reviving and boosting various businesses and industries has been taken because they have more or less came to a halt due to the national lockdown, the spokesman said."

So, now we will lure investors stating lawlessness and ease of exploitation as our USP.
Crony capitalism 101?

[Captain Slow]

Let's not forget what happened to the TATA's and their Nano Project over at WB!
Taiwan, Thailand, Philippines maybe even Nam, can be the possible replacements.
India still has a long way to go with our Bureaucracy and red tape.

https://graphics.wsj.com/table/DoingBusiness

[The Rationalist]

To all those who think that India can replace China, that’s a pipe dream. I know people who live there and those who do business there. According to them China is at least few decades ahead of India in most things. Forget replacing China, let’s try to catch up to them. Media and politicians are selling dreams to us, which are nothing but dreams. Keep dreaming.

[OrangeCar]

In my mind, this is how things will turn out.

Group of foreign companies wanting to exit China and enter India (assuming there are such companies), lets call them person A.

Our extremely agile and efficient government representatives who are eager to welcome new investments, employment opportunities and associated growth and development; lets call them person B.

Person A: Hello mister B. We want to get out of China and come to India. We want to invest $XYZ. We would like to build a factory to produce ABC units of something per year. Can we build one?

Person B: So, you want to build a factory here. You are coming here. Interesting. Well.. let me see if I can find a piece of land for you. Oh yes, you can build a factory here, where there is intermittent supply of electricity, absolutely no water and drainage, and go figure yourself transportation.

Person A: Oh.. hmm.. Okay, let me make the best of what I get. How do I get this piece of land?

Person B: Simple. Fill up form 226B, 348D, 724A, and some more forms and come back. BTW, you will also have to fill up form ABC, DEF and GHI for the state government.

Person A: Jaws drop. Okay. Where do I find these forms.

Person B: Do I look like a servant to you. Go figure yourself.

Person A: (probably still being hopeful) I have money. I am a multi-billion dollar company. Let me hire a private law firm that will help me establish this. Hello law firm, can you help us figure the eight thousand three hundred and forty two forms to be filled in and help us get a piece of land? We would like to build a factory.

Law firm, given its private, and looking to generate revenues and attract more customers who want to set up plants, does a diligent job.

Now with the huge bundle of forms, Person A goes to Person B's office.

Person B: It seems like a miracle that you have got all the forms. (Goes through a couple of forms). Hey! There is a comma missing here. A full stop there. Rejected.

Person A and law firm correct it and resubmit.

Person B: Submit only two thousand six hundred and thirty two forms here. Rest in different departments.

Person A: Okay. Where are the other departments?

Person B: Again.. do I look like your servant. Go figure out.

Person A: But the government said there is a one stop shop for all investors moving in from China to India.

Person B: Oh.. they did? Go to the person who said so and ask him how to do this.

Peron A: Now.. exhausted.. walks around. Figures the electricity department, water department, labor department, environment department, revenue department, PWD department, day dreaming department, just there for the heck of being there department, etc and gets all his forms rejected at least once. Why.. you know, just so that Person A acquires new skills of filling forms and pleading.

And the long story ends in a very simple fashion.

Person A says - chuck this sh*t. China with Corona is much better. Lets continue with whatever we have invested!

World goes back to being where it was.

Person B is successful in avoiding any future work that would have landed on his table had the company actually got through and set up a plant.

Vast majority of this nation would not even realize what happened. Will continue to read articles such as a magical western company having huge operations will be shifting to India. And gets happy!

[Sutripta]

If the land bank is for real, most of it will land up in the hands of (crony) Indian businesses.

Sutripta

[ValarMorghulis]

What's with the pessimism people? Yes, India is at least 30-40 years, if not more, behind China. Yes, China isn't the manufacturing only because of low cost manufacturing. Yes, China has better facilities owing to their governance form where they can bulldoze entire villages to provide facilities to companies.
But, they also have their own issues and this is where we can excel. Of course, we won't have all the 1000s of companies shifting base. That is merely a pipe dream, but if we can only have a wedge, a foot nay, a toe in the door, we might be on the right track.
If we are able to convince even 10% firms, it'll be great.
Yup, doom and gloom is alright but hey, give ourselves a sliver of chance

[avira_tk]

Originally Posted by ValarMorghulis

What's with the pessimism people? Yes, India is at least 30-40 years, if not more, behind China. Yes, China isn't the manufacturing only because of low cost manufacturing. Yes, China has better facilities owing to their governance form where they can bulldoze entire villages to provide facilities to companies.
But, they also have their own issues and this is where we can excel. Of course, we won't have all the 1000s of companies shifting base. That is merely a pipe dream, but if we can only have a wedge, a foot nay, a toe in the door, we might be on the right track.
If we are able to convince even 10% firms, it'll be great.
Yup, doom and gloom is alright but hey, give ourselves a sliver of chance

We are about a hundred years behind China given how slow we are. They have infrastructure, land, cheap labour and electricity, we have an inspector Raj and pretty much nothing else.

I doubt we'll be seeing even a dozen firms move here, we have tons of potential, but the only thing we have to offer investors, who will be retrospectively harassed is mountains of red tape. Things will be back to normal once the lockdown is in the past. Everyone will be on tiktok with their redmi phones , waiting for the next low cost flat screen TV. I'm typing this on a note 5, and don't see any alternatives to Chinese goods.

[Thermodynamics]

Sometime back, I read a Nexant report which clearly highlights India as a favourable investment destination. Multiple factors: Labor costs in China is getting expensive, the ongoing trade war, fear of keeping all eggs in one basket, the need to have multiple sources of manufacturing in order to ensure sustainable supply, India's democratic status, English speaking low cost highly skilled labour, Steady growth of exports etc.,

IMO, this is a great opportunity knocking our doorstep. It is up to our Government to embrace or shoo them away. If the effort as mentioned in opening post is true, this is a very good sign.

We have a stable Government for two consecutive terms, we have record low oil prices. However besides these advantages, our GDP performance has been abysmal, therefore, I will keep my fingers crossed about how they are going to handle it this time.

[Torq]

Originally Posted by OrangeCar

In my mind, this is how things will turn out.....!

Apologies for nit picking this specific post. But this isn't what happened with Tata and Gujarat. Apparently they got all the permissions and land for use with relative ease notwithstanding licence raj!
For past few years Mr PM has been quite vociferously trying to build and cultivate international relations. This includes Make in India campaign, Vibrant Gujarat summits.
Yes there will be hurdles, yes there will be issues in say land purchase, water supply, transportation, yes there will be issues specific to particular industry, but, when the government is keen, especially at the top, we will have a piece of the pie, albeit not the entire pie itself

In this race, it's not about whether Thailand or Vietnam or any other country, but rather about which specific state is more conducive to setting up of industries will be the winner here!

Gone are the days when we would have said, ye India hai, yaha kuch nahi ho sakta!
Guys, what's with the pessimism and criticism?