China is strategically limiting India's manufacturing competitiveness

Vivek Khatri, a chartered accountant and influential voice on finance, warns that India is losing its place in global manufacturing to China. He describes this as a strategic move by China, which he says is outmaneuvering India without making headlines. According to Khatri, while India is busy hosting summits and creating policies, China is quietly changing the global supply chain. China is using its large trade surplus as a tool to guide investments to countries like Hungary, Mexico, and Vietnam, which support its interests. Khatri believes India is being intentionally excluded from these plans. He suggests that China recalls how it built its manufacturing power and is unwilling to let India follow the same path. Khatri points out that India is struggling to attract necessary industrial inputs, such as parts for electric vehicles and electronics equipment. Companies like Foxconn and BYD are facing obstacles, and even Apple's operations in India are not meeting their production targets. Currently, India contributes about 15 percent to the global iPhone production goal of 25 percent. In contrast, Vietnam's electronics exports significantly outpace India's, with Vietnam at 126 billion dollars compared to India's 26 billion. Japanese and Taiwanese businesses are hesitant to invest in India due to its complex regulations and uncertainty. While China is shifting low-value manufacturing abroad, it keeps valuable technologies for itself. Khatri notes that India still has potential, with a large young workforce and strong market, but it must act quickly. He calls for India to cut bureaucracy, speed up trade agreements, develop industrial hubs, improve infrastructure, and enforce intellectual property laws. Khatri emphasizes that India does not need to become like China, but it must enhance its execution to compete effectively in the global market.