Companies coming to India from China after COVID-19
                     Companies coming to India from China after 
COVID-19
Global shift
• Global manufacturers have initiated talks with Indian firms to 
explore the possibility of shifting a part of their supply chains 
from China as they seek to diversify their operations following 
the COVID-19 outbreak. Most of these multinationals have 
suffered widespread disruptions to their businesses as 
authorities enforced strict lockdown measures
Source: Google Images
Automobile sector
• First of the lot are companies interested in sourcing automobile 
components and electronic products from India, according to 
industry executives. Pankaj Munjal, chairman and managing 
director of Hero Motors, said the auto parts maker has received 
several enquiries from companies who have operations in 
China, but now want to de-risk their supply chain.
Source: Google Images
China-reliant companies
• Part of the demand is also coming from Indian companies who 
were heavily reliant on China for sourcing components, but 
suffered because of the novel coronavirus-induced disruption 
in China, which, over the years, has emerged as a 
manufacturing powerhouse. Wuhan is one of China’s so-called 
“motor cities", housing several automotive factories.
Source: Google Images
Supply chains disrupted
• The COVID-19 pandemic has been unprecedented on many 
counts pertaining to public health, national security, and the 
global economy. When supply chains in China are disrupted 
that means supply chains around the world are disrupted. An 
eclectic mix of companies have been extraordinarily affected 
as production and distribution networks have gone awry.
Source: Google Images
Winds of change?
• But in the midst of this pandemic, as industries stall, there 
could be another form of disruption, in the sense used in 
Silicon Valley to signify the winds of change. Though Make in 
India sought to pitch India as an alternative manufacturing 
destination to China, ranging from leather to space, for 
investment meant emphasis on the big picture at the cost of 
more specific sectoral details.
Source: Google Images
China faces global scrutiny
• China has found itself facing global scrutiny since the 
pandemic erupted in Wuhan, both for its delay in not alerting 
the world community about its severity and for admonishing 
doctors and journalists, who served as harbingers of the 
pandemic, along with the ongoing trade disputes before the 
COVID-19 outbreak between US and China
Source: Google Images
Why India?
• India’s expanding economy and robust middle class provides a 
lucrative market while its abundant skilled and semi-skilled 
labor adds to the country’s ability to support bulk 
manufacturing, assembly, and processing. Furthermore, India’s 
overlooked eastern coast is strategically placed to connect with 
Asia-Pacific markets, an advantage to optimize supply chains 
and minimize transportation costs.
Source: Google Images
Advantage India
• In addition, India’s cost advantages come alongside its 
democratic fabric, with an emphasis on transparency and 
rules-based international order. India’s willingness to meet its 
supplier obligations without weaponizing trade provides the 
global business community with predictability and fair trade. 
Asian economic powers have also begun to announce 
incentives to move production out of China.
Source: Google Images
India is ready
• India is developing a land pool nearly double the size of 
Luxembourg to lure businesses moving out of China. A total 
area of 461,589 hectares has been identified across the 
country for the purpose. That includes 115,131 hectares of 
existing industrial land in states such as Gujarat, 
Maharashtra, Tamil Nadu and Andhra Pradesh
Source: Google Images