🇮🇳 Rising Wages in China, Shifting Geopolitics — Is India Ready to Step In?
As global companies search for alternatives to China’s manufacturing dominance, India is emerging as a leading contender. With a young workforce, expanding infrastructure, and political will, the country is positioning itself as the next global factory — but the path forward is far from guaranteed.
What’s Driving the Shift?
Several global trends are reshaping supply chains:
China’s rising labor costs and increased regulatory scrutiny
U.S.-China tensions, pushing for geopolitical diversification
Post-COVID need for resilient multi-location manufacturing
In this environment, India offers:
Over 900 million working-age citizens
Government incentives under Make in India and PLI schemes
A rapidly improving digital and physical infrastructure
Early Wins and Key Sectors
India is already seeing traction in:
Smartphones: Apple, Samsung, and Xiaomi are expanding assembly operations
Semiconductors: Micron and Vedanta are investing in chip fabs
Textiles and apparel: Firms are shifting from Bangladesh and China to Gujarat and Tamil Nadu
Renewables: India is becoming a hub for solar module and battery production
Notably, Apple aims to manufacture 25% of iPhones in India by 2025.
Challenges on the Road Ahead
Despite its promise, India faces real hurdles:
Logistics bottlenecks, including congested ports and inconsistent rail
Bureaucracy and policy inconsistency at the state level
Skills gaps, especially in high-tech sectors
Labor rigidity in formal employment structures
In comparison, countries like Vietnam offer faster regulatory turnaround and more integrated export processing zones.
Key Takeaway
India is not yet the “new China” — but it doesn’t need to be. Its unique scale, sectoral strengths, and tech-driven growth trajectory could make it a complementary manufacturing hub, especially for global firms seeking diversification with long-term upside.