By Choekyi Lhamo
DHARAMSHALA, APR 20: Around 1,000 foreign companies are engaged in discussions with Indian authorities as China’s slumping economy is projected to take a worsen following coronavirus pandemic, reports Times of India. India could become an alternate manufacturing hub as these companies take their proposals across various levels of the government.
“About 1,000-odd companies are currently engaged in discussion at various levels such as investment promotion cell, central government departments and state governments. Out of these companies, we are targeting 300-odd companies,” a top government source told TOI. At least 300 out of 1,000 companies have production plans in sectors such as mobiles, electronics, medical devices, textiles and synthetic fabric in India.
“We are hopeful that once coronavirus is in control, a lot of things will fructify into actual relocation. And India will emerge as an alternate manufacturing destination. Many countries like Japan, US, and South Korea are over-dependent on China and that is now very apparent,” he added.
Major companies are expected to shift their production out of China as nations speculate the country’s inefficiency in handling the virus outbreak. Many countries have been reliant on China as a manufacturing base due to lower costs of labour and products but the pandemic has led to renewed talks of change in location. Major countries are expected to shift out production from China or set up new businesses at alternate locations.
In September last year, India decided to slash corporate tax to 25.17% to push domestic manufacturing, and applicable tax for new manufacturers was brought down to 17%, making it the lowest in South East Asia. India hopes to attract a sizeable foreign investment in its manufacturing sector with a reduced tax rate. It has now directed its focus on reducing the cost of production.
Guruprasad Mohapatra, Secretary in the Department for Promotion of Industry and Internal Trade (DPIIT), told TOI, “Now the world is rethinking its strategy of putting all eggs in one basket. A lot of interest is being shown by companies towards India . . . India is generally considered an attractive destination because of its market size and also India being a possible hub for exports in the region. That’s the reason FDI has been recording very impressive growth in the last 5-6 years.”
In the changing political climate between the US and China, US President Donald Trump has accused China of mismanagement of the outbreak in its initial stage, and China has aggressively responded over Trump’s “Chinese virus” remark. Meanwhile, Japan’s PM Shinzo Abe announced that 2.2 billion dollars (220 billion yen) be allotted for its multinational companies to shift production out of China.
Many countries are expected to follow suit which might benefit India’s economy at large. Many politicians in Japan and the US have placed blame on China for failing to respond effectively, and for concealing the threat from other nations during the early days of the outbreak. The virus that has since spread across the world has put the global economy to a standstill.
One Response
Hallo Ladies and Gentleman. That’s what whole world is expecting all the time that one day foreign companies in China should move out from China and move to other nations like India and Tawain etc. Human rights record in China hadn’t shown any inprovement for many decades. Whole world knows human rights records in China hadn’t inproved at all and but it’s pity that whole world is keep on depending on China with the business. I’ts very shameful , sad and awful that whole world hadn’t also shown any inprovement of doing not to do business with China. World let human rights value on the side and considered doing business with China is more priority rather than the value of human rights..
But karma doesn’t let it go like that for long and shadows of the karma follow you. So Karma comes here. Coronavirus is the source of changing process of karma and creating a new Karma. Whole world is shaken dramatically by the Coronavirus and changed into new karma and another situation.
Whole world should do business with India rather than China because China hadn’t not improved the human rights records in China. India should work hard as China did for many decades in business field and did successfully. Now it’s time for India and getting an opportunity and shouldn’t miss the opportunity. India should success business with America, Europe and Japan and with more countries. God bless India. America, Europe, Japan , Twain and rest of the world.