How India can replace China as a global manufacturing hub post-COVID

In 2010, China overtook the US to emerge as the world’s largest manufacturing sector. However, the rise of China as the world’s factory began way back in the 1980s initially as a producer of low-end products which gradually rose to become a manufacturing hub of everything under the sun – from drugs to electronic gadgets. According to estimates of the UN Statistics Division, China accounted for 28 percent of global manufacturing output in 2018[1]. Yet, the Coronavirus epidemic is beginning to change this in many ways. The supply shock created by a Chinese shutdown has prompted global firms to look for new manufacturing centres as a part of a risk hedging strategy for the future. Several industries have realized the drawbacks of being excessively dependent on manufacturing on a single country and are looking to expand the geographic spread of their facilities. This presents a moment of opportunity for India which can reap rich dividends by creating a manufacturing-friendly environment and offering lucrative deals to global players for setting up units in India. Reports have indicated that a large number of companies have already initiated talks with Indian authorities seeking to pursue production plans in this country in sectors such as electronics, medical devices and textiles, among others[2]. India needs to capitalize on this opportunity and present itself as a viable alternative manufacturing destination.