As the trade war between the United States and China intensify, India is targeting foreign companies in its attempt to encourage them to move their businesses to the South Asian nation.
There have been reports claiming that Indian officials have met last August 14 to discuss how to persuade their target companies to take their businesses from China to India. Some companies said to be on India’s target list includes Wistron, Apple, and Foxconn.
The Taiwanese-based electronics manufacturing company Pegatron is also among the companies that are included in India’s list. The companies mentioned have not issued any statement regarding India’s move to capitalize on the growing US-Sino trade war.
For the past year, the United States and China have found themselves embroiled in a trade war. The trade dispute between two of the world’s most powerful economies has resulted in high tariffs on goods worth billions of dollars.
This has led to the disruption of the global supply chain and for investors to find other investment alternatives that would allow them to get away from these higher tariffs
In India, government ministries were tasked to create their policies and incentive structures and forward them to the country’s foreign investment promotion agency, Invest India. These are said to be part of the country’s plans for capitalizing on the current trade war.
India is said to be focusing on nine sectors. These include telecoms, electronics, pharmaceuticals, and automobiles.
According to reports, the Indian government, together with representatives from the State governments, are scheduled to meet different foreign companies from August 26 to September 5. During the meet-ups, India will be proposing the best and most compatible investment zones for company operations in the country.
During the meetings, India will be presenting to prospective investors about the complete package that the country can offer. This includes market factors and incentives that India can offer to these potential foreign investors.
This move is seen as India’s chance to take advantage of the current trade situation amid speculations that it seems like the country has also missed the chance to opportunity.
According to U.S. – India specialist at the Center for Strategic and International Studies in Washington Richard Rossow: “There is one other monster country that has a huge domestic market, India, but they have got to get moving.”
“There is no time to waste in catching that new wave and in fact, the question is: Have they already missed it?” added Rossow.
One of the industries that have been feeling the effects of the US-Sino trade war has been the automotive industry. The conflict has affected the global automotive supply chain and the biggest automakers in the world.
According to an Indian industry officer, officials held separate meetings with the local representatives of automakers. These meetings involved Honda, Hyundai, Volkswagen, and others. The Indian government spoke to these companies about considering moving their supply chain operations from China to India.
The companies believed to have met with Indian officials have either declined to comment or have not responded to requests.
The automobile industry is not the only one feeling the brunt of the U.S. and China trade war. It has also affected tech giants like Apple. By the end of the year, 46 out of 50 Apple products could be subjected to Trump’s tariffs.
On September 1, Apple products such as the Apple Watch and Airpods will be subjected to 30% tariff. By December 15, a wider range of Apple products will be hit with a 15% tariff.
On Wednesday, India adjusted its rules about companies sourcing 30% of its production locally. Foxconn, the company that assembles Apple phones, has been operating in India since 2015. It currently has two assembly plants in India and it plans to open many more in the years to come.
For years, Apple has been against these rules given that most of the components and devices that are being used to assemble its electronic products are made in China.
The announcement comes around the same time Foxconn shared its plans of making more iPhones in India.
The latest adjustment in investment rules by the Indian government is said to give Apple more boost in the country. Apple will soon start selling its iPhones to Indian consumers through its website. Over the next 12-18 months, Apple is expected to open its brick-and-mortar Apple Store in Mumbai.