IndianTiger
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India is poised to
win back the manufacturing
territory it had lost to China as
the giant north-eastern
neighbour loses some of its
competitive edge due to rising labour costs. In segments like electrical
goods, household goods,
clocks and many textile items,
Indian manufacturers have
got back some of the market
they had lost to cheaper Chinese imports and are now
looking to challenge the
dragon in foreign markets. "As China loses its edge,
buyers have started looking
at India for competitive
prices," said John Baby, CEO,
Funskool India, a leading
manufacturer of toys. Imports of electrical goods
from China into India dropped
26% last year, as cost
pressures made them less
competitive in the price-
sensitive Indian market. Worker wages have
appreciated more than 100%
between 2003 and 2009 in
China compared with a more
sedate rise of around 40%
during the same period in India. Indian manufactured goods
ranging from mobile phones
to garments and toys are
gaining greater global
acceptance as their Chinese
counterparts become more expensive, but these are still
very early days. The steady appreciation of the
yuan-3% this year itself-has
further made Chinese goods
costlier, opening doors for
India to push its electronic
goods, garments and other labour-intensive products into
global markets. India's export of electronic
goods rose 56% while its
import of Chinese electronic
goods fell 32% during 2010-11.
"Some customers have started
buying less from China due to its rising costs. This has
brought incremental business
to us," said Sudhir Dhingra,
chairman and managing
director of Orient Craft, one of
the largest Indian garment exporters. Chinas one-child policy, in
force for more than 30 years,
has started pushing up wages
as the workforce shrinks
average age of its population
is around 35 years, compared with Indias 25 years. Even big
MNCs are planning to expand
production in India to cater to
domestic and foreign markets,
as rising Chinese costs make
India more attractive. Owing to the growing
potential of the Indian
market, we have been
expanding our production
capacities and manufacturing
investments. Going forward, linked with the development
of the vendor eco system in
India and its cost
competitiveness, we are
looking at making India the
global manufacturing hub for the region, said JS Shin, CEO,
Samsung, southwest Asia.
Trade expert Biswajit Dhar
emphatically endorses the
trend, predicting a Made in
India phase in world trade. India may become the next
best thing for low-end goods
as MNCs will start to move to
India due to rapidly rising
wages in China, said Dhar,
who heads Research and Information Systems in
Developing Countries, a
thinktank. In an attempt to
maintain their share in world
trade, Chinese producers have
started shifting focus towards higher-value goods, for which
they can charge higher prices. To Indias advantage, this has
left a vacuum in the lower
and middle end of the value
chain, which was earlier
predominantly occupied by
China. Experts believe this is an unprecedented
opportunity for India, as no
other country has comparable
human resources.
m.economictimes.com/news/news-by-company/corporate-trends/india-set-to-gain-as-china-losing-manufacturing-edge-due-to-rising-labour-costs/articleshow/9928935.cms
---------- Post added at 02:24 PM ---------- Previous post was at 02:22 PM ----------
china punished by 1 child poliy for 30 years,
win back the manufacturing
territory it had lost to China as
the giant north-eastern
neighbour loses some of its
competitive edge due to rising labour costs. In segments like electrical
goods, household goods,
clocks and many textile items,
Indian manufacturers have
got back some of the market
they had lost to cheaper Chinese imports and are now
looking to challenge the
dragon in foreign markets. "As China loses its edge,
buyers have started looking
at India for competitive
prices," said John Baby, CEO,
Funskool India, a leading
manufacturer of toys. Imports of electrical goods
from China into India dropped
26% last year, as cost
pressures made them less
competitive in the price-
sensitive Indian market. Worker wages have
appreciated more than 100%
between 2003 and 2009 in
China compared with a more
sedate rise of around 40%
during the same period in India. Indian manufactured goods
ranging from mobile phones
to garments and toys are
gaining greater global
acceptance as their Chinese
counterparts become more expensive, but these are still
very early days. The steady appreciation of the
yuan-3% this year itself-has
further made Chinese goods
costlier, opening doors for
India to push its electronic
goods, garments and other labour-intensive products into
global markets. India's export of electronic
goods rose 56% while its
import of Chinese electronic
goods fell 32% during 2010-11.
"Some customers have started
buying less from China due to its rising costs. This has
brought incremental business
to us," said Sudhir Dhingra,
chairman and managing
director of Orient Craft, one of
the largest Indian garment exporters. Chinas one-child policy, in
force for more than 30 years,
has started pushing up wages
as the workforce shrinks
average age of its population
is around 35 years, compared with Indias 25 years. Even big
MNCs are planning to expand
production in India to cater to
domestic and foreign markets,
as rising Chinese costs make
India more attractive. Owing to the growing
potential of the Indian
market, we have been
expanding our production
capacities and manufacturing
investments. Going forward, linked with the development
of the vendor eco system in
India and its cost
competitiveness, we are
looking at making India the
global manufacturing hub for the region, said JS Shin, CEO,
Samsung, southwest Asia.
Trade expert Biswajit Dhar
emphatically endorses the
trend, predicting a Made in
India phase in world trade. India may become the next
best thing for low-end goods
as MNCs will start to move to
India due to rapidly rising
wages in China, said Dhar,
who heads Research and Information Systems in
Developing Countries, a
thinktank. In an attempt to
maintain their share in world
trade, Chinese producers have
started shifting focus towards higher-value goods, for which
they can charge higher prices. To Indias advantage, this has
left a vacuum in the lower
and middle end of the value
chain, which was earlier
predominantly occupied by
China. Experts believe this is an unprecedented
opportunity for India, as no
other country has comparable
human resources.
m.economictimes.com/news/news-by-company/corporate-trends/india-set-to-gain-as-china-losing-manufacturing-edge-due-to-rising-labour-costs/articleshow/9928935.cms
---------- Post added at 02:24 PM ---------- Previous post was at 02:22 PM ----------
china punished by 1 child poliy for 30 years,
