Effective industrial policies attract foreign tech investments

Since 2020, G20 nations have introduced various industrial policies, including the US CHIPS Act and China's MIC 2025 initiative. These policies aim to reshape global industrial production, with significant investments in domestic manufacturing. India's Domestic Content Requirements (DCR) scheme favors local manufacturers in public procurements, while production-linked incentives (PLIs) have provided substantial subsidies. However, India's high tariffs and protectionist measures have hindered export growth, limiting competitiveness. In contrast, the US has successfully attracted foreign investment through targeted subsidies and incentives, particularly in semiconductor manufacturing. Taiwan Semiconductor Manufacturing Company has committed $165 billion to expand its operations in Arizona, enhancing the US's self-reliance in chip production.