![\"India\u2019s](\"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2024\/02\/Indias-True-Manufacturing-Rival-is-Vietnam-not-China.webp?resize=469%2C366&ssl=1\")
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Source:<\/strong> This post on Building a Robust Manufacturing Sector has been created based on the article \u201cIndia\u2019s true manufacturing rival is Vietnam, not China\u201d<\/strong> published in \u201cBusiness Standard\u201d<\/strong> on 10th<\/sup> February 2024.<\/p>\n UPSC Syllabus Topic: <\/strong>GS Paper 3 Indian Economy – Changes in industrial policy and their effects on industrial growth.<\/p>\n News:<\/strong> The article discusses the steps India should take in order to build a robust computer and electronics manufacturing industry. India\u2019s True Manufacturing Rival is Vietnam not China<\/strong><\/p>\n Background:<\/strong><\/p>\n The US recently appealed India to make the business environment easier and transparent or risk losing foreign direct investment. Earlier, Japanese Foreign Minister also requested cooperation to improve the investment environment in India.<\/p>\n This is a reflection of the fact that many countries want India to succeed economically in order to build a viable alternative to China.<\/p>\n 1) Export-Driven instead of Focusing on the Domestic Market: <\/strong>Instead of concentrating on the domestic market, it should become regionally competitive and export-driven. A domestic market alone isn\u2019t enough to sustain large and complicated electronics supply chains.<\/p>\n 2) Recognising Competition: <\/strong>India should remember that it doesn\u2019t hold a monopoly over business migration away from China. Countries, particularly Vietnam and others such as Mexico, Thailand, Indonesia and Czech Republic are also in competition in the computer and electronics sector.<\/p>\n 3) Cutting Import Duties: <\/strong>For more than 85% of the tariff categories<\/strong> within electronics<\/strong>, India\u2019s duties are higher than its competitors. 4) Provide Other Incentives: <\/strong>These include tax breaks, dedicated free-trade or industrial zones, discounted utilities like water and electricity, free land and commitments to supply workers.<\/p>\n <\/p>\nWhat Should India do to Build a Robust Computer and Electronics Manufacturing Industry?<\/strong><\/h2>\n
\nThese high import duties lead to companies catering to local consumers but makes them less competitive in the export market. Hence, cutting import duties should be a priority.<\/p>\nRead More UPSC Topics-<\/strong><\/h2>\n