China’s ‘world factory’ moniker, and whether India or others could steal it, remains topic of discourse

Disparaging comments in state media about India’s ability to supplant China in manufacturing come as multinationals have increasingly been diversifying supply chains

Poor infrastructure, industrial shortcomings and relatively weak literacy in places such as India are all cited as reasons China will stay competitive

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The extent to which Indian factories can supplant Chinese factories will largely be determined by the diversification plans of multinationals. Photo: Shutterstock

Published: 9:30pm, 6 Jan 2023

Chinese state media appears to be downplaying concerns that countries such as India could steal China’s crown as the so-called world’s factory in the short term, despite transnational firms diversifying their supply chains away from the world’s second-largest economy.

“India, or any other single country in the world, is unlikely to completely replace China’s position as ‘world factory’ in the short term,” Shanghai Academy of Social Sciences researcher Hu Zhiyong was quoted as saying by the state-owned Economic Daily on Friday.

“It’s even more difficult for India to undertake the difficult task of transferring part of China’s industrial chain.”

Hu also contended that many multinational companies remain wary of investing in India, partly due to its government’s tariffs on foreign-made parts.

His remarks came amid heated debate in China about whether it has been losing its long-held status in global supply chains due to disruptions from Covid controls, concerns over policy uncertainties and geopolitical tensions with the US, as well as calls from foreign businesses about reducing their overreliance on the Chinese market.