India has been ranked as the world's second most sought-after manufacturing destination. It is only second to China, and it has surpassed the United States to take the second position. In terms of cost, India, on the other hand, has dropped a notch and has been surpassed by Indonesia.
India could benefit from relocations from China to other parts of Asia, according to the Cushman and Wakefield 2021 Global Manufacturing Risk Index, because it already has a strong base in pharmaceuticals, chemicals, and engineering, all of which are still at the centre of trade tensions between the United States and China. Reforms in land and labour regulations, on the other hand, are critical to India's success as a global manufacturing hub, according to the report.
The baseline scenario prioritises a country's operating conditions as well as its cost competitiveness.
China, meanwhile, has maintained its leadership position and is expanding its manufacturing base. Despite the Biden administration's concerns about trade, China continues to broaden its base in order to focus on telecom, high-tech, and computers, according to the report. Guangdong and Jiangsu are the rulers in electronic components and automobile production, while chemicals and natural resources are concentrated in Zhejiang and Liaoning.
The United States is an ideal hub because it has a huge consumer market as well as state and federal incentives. However, the research warned that its quick adoption of technology and regulations might make it a tough competitor to China.
Indonesia surpassed India and Vietnam in terms of cost, while China maintained its lead. India dropped to third place, while Indonesia jumped from fifth to second place.
The report stated that, Jakarta's falling rents have a role to play in the country's cost effectiveness, which has pushed it up three spots. While wages in Vietnam are lower than in China, the country is increasingly experiencing competition from lower-cost countries. Thailand's cost profile, meanwhile, has brought them up to fifth place from eighth. Colombia, which has labour costs comparable to those in Asia, climbed from 15th to eighth place.
India, on the other hand, is nowhere near the top of the risk scenario that takes into account lower levels of economic and political concerns. India is grouped with Malaysia, Belgium, Indonesia, Bulgaria, Romania, Thailand, Hungary, Colombia, Italy, Peru, and Vietnam in the third quartile of the rankings. China leads the first quartile, followed by Canada, the United States, Finland, and the Czech Republic. Lithuania, France, the Netherlands, Spain, Poland, Japan, and the United Kingdom are among the countries in the second quartile.
India, like Sri Lanka, Mexico, Vietnam, Indonesia, Bulgaria, Thailand, Tunisia, Peru, Philippines, and Venezuela, is in the fourth quartile when it comes to the bounce back rating, which considers a country's ability to restart its manufacturing sector.
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