India is trying to become the new factory of the world, but it could take more than a global pandemic to unseat China from its 40-year reign
"China manufactures at scale, while most factories in India are small and midsize due to federal regulations and protections designed specifically for SMEs," said Gerdeman.India's Prime Minister Modi has been working on attracting foreign direct investments, or FDI, since he took office in 2014, sending FDI to a record $83.
What he means is that China has managed to build up a value chain so extensive that almost everything required to make a product can be sourced and acquired in the country, which allows for low-cost manufacturing on a large scale. In contrast, India doesn't have this capability yet, which takes years to build up.
That's because manufacturers always start factory operations with the assembly line before starting to develop local supply lines for the finished products in a"backward integration" of processes, said Sharma. "That supply chain takes time for it to build because even when you are sourcing it internally, the quality is not that good initially, your scale is not that high, and you run into those issues. So yes, it can be done, but it takes time," he told Insider.In any case, companies are unlikely to flock en masse to India like they did to China because it's just been proven too risky, the experts said.
And it's not just Foxconn and Apple that have gone all in on China and are now suffering for it: US sportswear giant
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