India emerges as second most attractive manufacturing hub globally, says report
India had moved up to the third place from the fourth spot last year and now has gained one more spot upward to rank after China (The Economic Times photo)
India had moved up to the third place from the fourth spot last year and now has gained one more spot upward to rank after China (The Economic Times photo)

India has emerged as the second most sought after manufacturing destination across the world indicating the growing interest shown by manufacturers in India as a preferred manufacturing hub over other countries, including the US and those in the Asia-Pacific region, showed Cushman & Wakefield’s 2021 Global Manufacturing Risk Index. The rising focus on India can be attributed to India’s operating conditions and cost competitiveness. Also, the country’s proven success in meeting outsourcing requirements has led to the increase in the ranking year on year. This year, India and the US switched places — second and third — taking India one rank above from the rankings released last year, when India stood at the third place. India had moved up to the third place from the fourth spot last year and now has gained one more spot upward to rank after China.

“India in its growth story transitioned from an agricultural economy to a services economy. The country nearly skipped the manufacturing leg of this transition. Yet on the back of cost and talent India finds itself favourably placed in the global rankings. Indian manufacturing has also shown great resilience during and post the second wave of COVID-19. But to have greater investor confidence and unleash the Make In India agenda, we will have to address land and labour reforms and also upgrade infrastructure across sectors,” said Anshul Jain, Managing Director – India and South East Asia.

Asia Pacific’s largest manufacturing centres have rebounded strongly as economies across the globe have reopened and driven demand for key products.
“Other markets also capitalised on heightened demand for key products such as micro-processors, computer chips and pharmaceuticals. South Korea has benefited from the soaring value of semiconductors, stemming from strong demand and a global shortage of product with Information and Communication Technology (ICT) manufacturing up 16.8 per cent year over year in January 2021,” said Dominic Brown, Head of Insight & Analysis, Asia Pacific at Cushman & Wakefield.

However, according to Brown, apparel producers around the region continue to struggle with low levels of demand impacting markets such as India and Indonesia, which have also been managing significant second and third waves of the virus. The index assesses the most advantageous locations for global manufacturing among 47 countries in Europe, the Americas and Asia Pacific. The rankings are determined based on four key parameters including the country’s capability to restart manufacturing, business environment including availability of talent and labour, access to markets, operating costs and the risks such as political, economic and environmental.

The baseline ranking for top manufacturing destinations is determined on the basis of a country’s operating conditions and cost effectiveness. The switch in the US and India’s ranking is attributed to the plant relocations from China to other parts of Asia due to an already established base in pharma, chemicals and engineering sectors, that continue to be at the centre of the US-China trade tensions. Despite being amongst the top three countries in the baseline and cost scenario rankings, there is a long road for India to traverse when it comes to areas like managing the geopolitical risks involved in running business and its ability to restart its manufacturing business after a devastating second wave of the COVID-19 virus. (The Economic Times)

SHARE THIS ARTICLE :
Facebook
Twitter
WhatsApp

Leave a Comment

Your email address will not be published. Required fields are marked *

All our printed editions are available online
emblem3
Subscribe to the Guyana Chronicle.
Sign up to receive news and updates.
We respect your privacy.