US-led diversification push tests India’s potential as a China supply chain alternative
- There is a growing consensus among policymakers and analysts that India is emerging as an alternative production base to China
- But the country must address challenges ranging from red tape to skills shortages if it wants to capitalise on Western diversification
As Western nations become increasingly concerned about over-reliance on China, few countries stand to gain more than India.
In her first visit to New Delhi as US Treasury secretary earlier this month, Janet Yellen described India as an “indispensable partner” in the US’ quest to diversify its supply chains.
“As someone who’s dealt with India for the last 20 years, for the first time, I became convinced that they are about to attempt a significant policy shift,” said Rudd during a business conference in Singapore.
Rudd’s words highlight a growing consensus among policymakers and analysts that India is emerging as an alternative production base to China.
India is hoping to benefit economically from Western concerns about growing Chinese hegemony
“What we are seeing geopolitically is effectively a new cold war,” said Sadanand Dhume, senior fellow at the American Enterprise Institute. “Against this backdrop, India is hoping to benefit economically from Western concerns about growing Chinese hegemony.”