India to challenge China as the manufacturing hub in 3-5 years

MUMBAI: A survey of 340 companies worldwide by consulting and outsourcing major Capgemini and ProLogis suggests that India could challenge China as the manufacturing hub of the world in the next three to five years.
   
According to the report, some of the main manufacturing locations in China are becoming too expensive relative to other countries in the region, which includes India.
   
"India is on the threshold of an exciting opportunity in the manufacturing outsourcing space...respondents indicated that they see manufacturing activities as the primary activity to be offshored to India in the next 3 to 5 years, surpassing even IT and BPO activities," Capgemini India's Executive Chairman Salil Parekh said here on Friday.
   
India is the destination of choice for IT, finance and customer service activities while China  offshoring destination for manufacturing.
   
However, the response of more than 340 of the world's largest international manufacturing companies from Europe, North America, Asia Pacific suggested that India will become a substantial manufacturing destination in coming years.
   
"If the Indian government makes significant investments in infrastructure then it should be able to attract foreign manufacturing activities and its potential," the report said.
   
Around 43 per cent of the companies that offshored manufacturing activities to India have not achieved their initial objective due to lack of manufacturing and supply chain infrastructure.