As electronics manufacturers like Foxconn move their factories from China to India, they are running into some cultural differences. ‘We are taught not to mention religion or politics, and to say “please”‘, one Chinese engineer training Indian workers says, ‘People from China talk in a blunt way. But with Indians, we have to be more polite.’
The Foxconn engineers also complain that Indians take too many holidays and are late to meetings. But that’s not stopping the investments.
The winds of manufacturing, which have long blown east towards China, are changing direction. As China grows more assertive – some would say argumentative – under Xi Jinping, US and Europe are scrambling to curb its growth through sanctions. These sanctions have already had the effect of slowing down China’s annual exports of electrical and electronic equipment, valued at $955 billion.
Enter India. With China losing favour, countries like India, South Korea and Vietnam are receiving new investments in semiconductors, electronics and technology.
Recent data shows China’s FDI turning negative in Q3 2023 for the first time since 1998. This shift is evident in the latest iPhones coming with a “Made in India” tag rather than “Made in China”.
While other manufacturing centers like South Korea are more advanced in electronic manufacturing, India lags due to technological and infrastructural hurdles. The Indian government has implemented the National Electronic Policy (NEP) and production-linked incentive schemes to change this.
India’s electronic system design and manufacturing (ESDM) industry is expected to grow at a remarkable 32% CAGR over the next five years, thanks to increased per capita spending, higher rural penetration of electronics, the rise of electric vehicles and increased use of electronics in the medical field. Trendlyne