India’s economic narrative is robust, and it is well positioned to gain from Asia’s diversification of the manufacturing supply chain: Group The Economist

India is in a good position to profit from the geopolitical and economic developments that are causing Asia’s manufacturing supply chain to diversify, and it is also the “manufacturing moment” for the nation, according to The Economist Group.

Upasana Dutt, Head of India at The Economist Group, emphasized that governmental changes are making doing business in India simpler while also stating that the nation has a great growth narrative.

India is the fastest-growing major economy in the world, with a growth rate of 7.8% in the June quarter. The government has also introduced a number of programs, such as Production Linked Incentive (PLI) programmes, to encourage local manufacturing operations across a variety of industries.

A symposium on “Navigating new globalization, innovation for progress” was held in the nation’s capital last month. Economist Impact is an official network partner of the B20.

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Upasana Dutt said that India is rising to take a greater place on the international scene during a recent conversation before the G20 Summit.

She added that supply chain restructuring, global investment in resources that are essential to future industries, as well as the green transition, will present opportunities for nations like India. “This transformative development signifies a departure from convention; it endows us with the opportunity to exert substantial influence over global discourse,” she said.

She said that this is India’s “manufacturing moment” in regard to the nation.

“India is in a good position to gain from the geopolitical and economic dynamics that are causing Asia’s industrial supply chain to diversify. Its attraction to investors would be based on having a robust, stable economy and access to a vast labor pool, she told PTI.

In the aftermath of the Russia-Ukraine conflict and the Coronavirus outbreak, there have been supply chain interruptions.

“Businesses will be prompted to reconsider how they approach their supply networks and target markets as a result of geopolitical risk. Derisking from China will result in increased global capital allocations for other markets. As firms consider their China+1 strategy, India might be a backup route to China, she said.

Significant advancements in a number of sectors, including infrastructure, taxes, and trade regulation, according to the Economist Intelligence Unit (EIU), will lower the risks associated with industrial investment in the nation.

“Policy changes are facilitating business in India… In general, the growing economic importance of emerging markets signals a change in the balance of power; even if the US will continue to have sway, other developing countries, such as India, will be perceived as playing a larger role, she said.

At the same time, she noted that India’s path to becoming a significant manufacturing power would be a lengthy one due to tough competition from other growing economies, particularly in Southeast Asia.

“India’s development narrative is compelling. Growth rates are predicted to be about 6%. Investments will benefit this decade. Additionally, we anticipate a lot of policy-related concerns to lessen during this time, notably those connected to infrastructure, taxes, and other difficulties, she said.

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