Indian State Of Gujarat Luring Japan, US Companies To Shift Production Base From China

With the world battling the Covid-19 pandemic, many global organizations including Apple, Microsoft, Google are contemplating moving production lines out of China. Indian state of Gujarat, home of PM Modi,  is keen to capitalize on the situation.

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According to reports in Times of India, Gujarat has written to political and business authorities of the US and Japan, inviting them to move their commercial units and operations from China to the Indian state.

The Gujarat government has reportedly assured all assistance and incentives to organizations that decide to shift their operations from China to Gujarat.

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Principal secretary, industries, Manoj Das confirmed the development and affirmed that the Gujarat government had indeed communicated to the Japanese government, Japan External Trade Organization (JETRO), US-India Business Council (USIBC) and US-India Strategic Partnership Forum (USISPF), inviting the US and Japanese organizations. While Tokyo has already declared a package for businesses to relocate their operations out of China, we have a dedicated Japanese park in Gujarat,” TOI quoted the official.

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Mona Khandhar, IAS, Embassy of India, Tokyo said Japanese corporations lead in the manufacturing of high standards in a number of sectors. “From a global perspective, Japanese organizations have the highest number of foreign subsidiaries in China, followed by ASEAN countries. For pulling Japanese firms, India will see tough competition with ASEAN peers.”

As EurAsian Times reported earlier, ASEAN nations led by Vietnam and Thailand could benefit the most of global organizations pull out from China.

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According to the Nikkei Asian Review report, after the US-China trade war last year and the coronavirus outbreak in the current year, American technology giants Apple, Google, and Microsoft are reportedly looking for shifting their production base outside China and Vietnam was the perspective destination.

Microsoft too is scheduled to begin production if its notebook and personal desktop computers in northern Vietnam in the second quarter of this year at the earliest. Google started its shifting out from China last year as it asked one of its partners to covert an old Nokia facility to handle the production of Pixel phones while approving another facility in the same country.

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As per experts talking to EurAsian Times earlier, the creation of new industrial clusters won’t happen overnight in any country. Vietnam offers cheap labour, but its 100-million population is small compared with China’s 1.3 billion, and its roads and ports are already clogged. India has the manpower, but skill levels fall short of expectations and government rules, despite all the assurances, are restrictive.