How India can get Benefited by its mutual cooperation with Chinese manufacturers?

India won’t be finding it easy to dethrone a global economic superpower like China from the world’s outset. Even though India carries its own list of drawbacks, it got an upper hand just because of its labor costs. This is where both India and china holds the key to rule the global manufacturing markets with mutual cooperation in the times to come.

On the other hand, the electronics manufacturing have got benefit-ted in the same manner as the automobile industry did in the early 90s after the arrival of Suzuki in the Indian automobile markets. That was the time when whole industry got stunned by the same deal initially, but eventually transformed big time after Suzuki brought all the latest auto manufacturing techniques on board for its overall growth.

If we have a look at the India’s labor cost in 2015, it came down as $1.72/hour in comparison to $37.96/hour for US whilst having the same as double to china. Meanwhile government has introduced certain manufacturing programmes in order to shift the electronics manufacturing from semi-knocked down (SKD) to completely knocked down (CKD) kits. This, in turn, would encourage the import of semi-assembled parts and introduce more employment opportunities for the local people in the process. Still it can be quoted that shifting the SKD to CKD alone would not do any good for the big purpose. Manufacturing industry in India needs to be encouraged and this should be done whilst keeping the global markets in mind. Most of the big trading giants must look forward to tap into the global markets and government authorities must push all these efforts while introducing added incentives for the export of electronics goods. Again, this would lead to a more supportive atmosphere for the global businesses and attract more FDI into the country from global electronics component manufacturers whilst creating better employment opportunities in the process.

When we talk about the total cost of road transportation in India, 1 tonne of freight over 1km gets to 2.28 and same goes to Rs 1.41 by rail and Rs 1.19 for waterways.

India enjoys a perfect geographical location with a number of commercial ports around and whilst we understand that water transportation is much cheaper here, we can certainly capitalize on the same advantage over the time. Secondly, an extra incentive on the goods export can certainly works as an icing on cake.