Copyright © HT Digital Streams Limit all rights reserved. Tripti Lahiri, The Wall Street Journal 4 min Read 19 Apr 2025, 03:21 IST workers at Zetwerk’s Noida Factory Summary The world’s most populated nation has long moved, but also smaller countries with nimbler governments. NEW DELHI – When President Trump opened his first trade war against China in 2018, a company called Zetwork just started connecting global customers to Indian suppliers of things like sheet metal and precision parts. Today it has a network of over 10,000 suppliers and seven of its own electronic factories. The latest facility, which makes parts for washing machines and other devices, was opened in March. The First Trade War has helped India to get up- and Trump’s second one can be transformative, says Josh Foulger, the head of Zetwerk’s electronic enterprise. “Is that India’s moment?” says Foulger. ‘Yes.’ With most Chinese exporters cut off from US consumers with high rates, businesses are looking for alternative places to produce and export to the US – which has a golden opportunity for India. This does not mean that India will take its chance. The world’s most populated nation has long been not only China, but also smaller countries with Nimbler governments. The number of people working in agriculture dwarf the number used in manufacturing. Global high-tech firms and retailers say India is a more difficult place to do business than China or Vietnam, due to the hassle of government, tranquil labor groups and an often-coveted approach to compliance and tax. Vietnam, a country of 100 million people, exports more iPhones to the US from India, and the country currently accounts for about 20% of the final production of iPhone, according to the market research estimates. Most Indian goods have only a 10% US import tariff. The election of India last year, in which the ruling Bharatiya Janata party of Prime Minister Narendra Modi lost its direct majority, sent a clear message that many voters were dissatisfied with job prospects and low wages. India now has a critical window for opening no local or national election on the horizon for about a year, says Tanvi Madan, an India expert at the Brookings institution. The moment can be just as important to India as the end of the Cold War, when it falls into a financial crisis caused by the collapse of the Soviet Union, then India’s largest trading partner. In response, India has opened to foreign investment and a plethora of rules and regulations known as the ‘license Raj’, grow faster. “India has always been concerned about what the world’s opening will do about it,” Madan said. “It has to reflect on what the world can do for it.” Foreign Minister S. Jaishankar said this month that the revival of the world trade “focused our own thoughts on the need to call what I would correct, a certain skewed nature of our openness to the global economy.” However, businesses that India are prone to regulatory flip-flops and head-scratching interpretations of tax laws, leading to fines or long legal disputes. India has claimed $ 1.4 billion for back taxes 12 years ago from a unit of German car manufacturer Volkswagen, and an equal amount as a fine, claiming that it has mislassified the shipments imported to India to evade customs duties. The company denies offense and disputes the order in court. “You are thinking of China 30 years ago and Vietnam now, you have government officials in their areas who wake up every day and think, ‘How can I make it easier for companies to come here and invest here? ” Said an executive with an US firm that has been active in India for a long time. Yet smartphones provide an example of what India can do if it thinks about it. A decade ago, when India began to focus on building phones, the annual export of cell phones was only about $ 250 million. Now the figure is over $ 22 billion, with Apple making up about three -quarters of it. A factory in Karnataka operated by the Foxconn of Taiwan is on track this year and will eventually add an annual production of 20 million phones, which will compete with Foxconn flagship plant in the neighboring state Tamil Nadu. Officials say a network of suppliers is growing up to feed the final meeting. Corning in New York, which has long made scratched glass for Apple phones, plans to start production in Tamil Nadu this year. Smartphones provide an example of what India can do if it thinks about it. Companies say smartphones benefit from the government’s attention and support, including manufacturing subsidies. India said this month that it will expand the subsidies to telephone components that are largely importing it, and that it has upgraded the cargo terminal at Tamil Nadu’s main airport to address issues that sometimes carry vehicles on the highway. Foulger, the executive that links global companies to Indian suppliers, was the country’s head of Foxconn in India before joining Zetwork last year. He said the country still needs improvement on the most important quality for a global supply chain: consistency. His mantra is to plan ahead, which he said he regularly repeats when he hears a supplier who calls a series of public holidays as the reason for a delay or a worker who blames Bangalore’s notorious traffic. “All of this must be like this 128-piece orchestra that works in synchronization to make it happen,” Foulger said. “It’s going to be a journey, it’s going to take some time, but because of India’s inherent strengths, I think we’ll triumph.” Write to Tripti Lahiri at Tripti.lahiri@wsj.com, capture all the industry news, bank news and updates on live currency. Download the Mint News app to get daily market updates. More Topics #china Rates #Genitstate #Munting Mint Specials
India has a golden opportunity to acquire US business from China
