India turns a pandemic into an opportunity! Becomes 2nd most attractive manufacturing hub
India has emerged as the second-most attractive manufacturing destination internationally by surpassing the United States.
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New Delhi, August 25: Under the leadership of Prime Minister Narendra Modi, India turned the pandemic into an opportunity and emerged as the second-most attractive manufacturing destination internationally by surpassing the United States.
India’s ranking was reflected in Cushman & Wakefield’s 2021 Global Manufacturing Risk Index. The rankings in the report are determined based on four key parameters, including the country's capability to restart manufacturing, business environment (availability of talent/labor, access to markets), operating costs, and the risks (political, economic, and environmental). The baseline ranking for top manufacturing destinations is determined based on a country's operating conditions and cost-effectiveness.
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"India takes the second spot after China as the most sought-after manufacturing destination globally," Cushman and Wakefield said in a statement.
In its report, it stated that India could benefit from relocations from China to other parts of Asia, as it already has an established base in pharmaceuticals, chemicals, and engineering -- sectors that continue to be the focus of the US-China trade tensions.
The ranking shows that manufacturers are showing a growing interest in India, as a preferred manufacturing hub over other countries including the United States and the manufacturing giant nation, China.
"The growing 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," the statement said
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"This switch in 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 center of the US-China trade tensions," it said.
As far as the cost scenario ranking goes, India continued to retain the third spot like last year, while Vietnam is pushed to the fourth position from the third."Despite being among 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 a business and its ability to restart its manufacturing business after a devastating second wave of the Covid-19 virus," Cushman said.