Concerns of Companies Amid 'New Cold War and De-Chinaization'... Pioneering the 21st Century 'India Route'

Global Companies Facing China's Lockdown... Spotlight on India
Government and Startups' Efforts for an 'Export-Oriented India'

Due to the impact of COVID-19, global companies facing difficulties in sourcing and procuring parts from China are turning their attention to India as a new manufacturing hub.

On the 29th, The Wall Street Journal (WSJ) reported that global companies, which experienced lockdowns in China due to COVID-19, are seeking opportunities to connect with startups and industries in India instead of China.

According to the report, the global manufacturing network 'Jetwork' used to import steel parts from China before COVID-19, but imports became difficult due to the lockdowns. As a result, Jetwork changed its suppliers to manufacturers within India, connecting global companies in need of steel parts with Indian manufacturers, successfully revitalizing the Indian manufacturing industry.

Following this B2B e-commerce success story, many startups in India are striving to transform India into a more export-oriented model. At the government level, a favorable environment is being created by actively investing in companies that aim to procure materials and produce within India.

Mobile phone manufacturing factory in India. [Photo by Reuters]

Accordingly, global companies are turning their eyes to India as the next manufacturing market to follow China.

Walmart, boasting the world's number one sales, stated, "India is recently emerging as a global manufacturing hub," and announced plans to increase exports of Indian-made goods to $10 billion (approximately 13.23 trillion KRW) by 2027. Walmart plans to export Indian-made products worldwide by securing new suppliers in addition to existing major export products.

Apple has also chosen India as a new production base. Foxconn, Apple's largest partner from Taiwan, purchased 1.2 million square meters of land on the outskirts of Bengaluru, India's technology hub, to build an iPhone parts factory.

However, WSJ evaluated that the Indian market is not yet at a level to replace China, which handles global manufacturing. While it surpasses other emerging markets such as Mexico and Vietnam, it is still only one-tenth the size of China.

Nevertheless, WSJ noted, "India also has a network of small and medium-sized factories producing specialized products such as clothing and chemicals," highlighting the potential of India's yet-to-be-explored production capacity.

This content was produced with the assistance of AI translation services.