Reacting to the recent decision by Cupertino-based tech giant, Apple, to assemble iPhones in India, Chinese state-run Global Times in an op-ed on Wednesday urged Beijing to step up efforts to ensure that China doesn’t lose position to its South-Asian neighbour in the race for being the manufacturing hub of the world.
Global Times, which has close ties to the ruling Communist Party of China (CPC), urged the leadership to shift its focus and “design a strategy to retain manufacturing jobs and upgrade its manufacturing industry to maintain competitiveness.”
Evolving Manufacturing Landscape a Threat For China
Taking note of the threat to its manufacturing sector posed by India’s softening stance towards foreign investors, the op-ed said:
If Apple expands in India, more global tech giants may follow suit and China is likely to see a further transfer of the supply chain given India’s abundant supply of working-age labourers and low labor costs. China cannot afford to lose manufacturing jobs since it has not made a major breakthrough in upgrading its industry while Trump plans to draw manufacturing jobs back home.
Need to Counter India’s Low-Cost Workforce
Cautioning against India’s undue advantage when it comes to low labour costs, it noted that industrial competition between China and India comes down to the labour force, where costs and the level of skills are two major factors that influence business decisions. The op-ed thus urged the government to exploit low-cost labour available in China’s central and western regions to tackle this challenge posed by India.
The country’s central and western regions, with cheaper labour, could become an investment haven for manufacturers as these regions need capital to boost the local economy and are certainly ready to offer preferential policies to attract investment. It will be easier for these areas to replicate the success of the country’s eastern coastal region as a manufacturing hub.
(Source: Global Times)
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