India Will Replace Communist China As “Global Economic Locomotive”

According to reports, as the growth of economic powers such as China and Germany slows, the global economy needs a new engine of growth. Morgan Stanley predicts that India will drive one-fifth of global growth in this decade, making it one of only three countries whose annual economic output grows by more than $400 billion. The escalating trade and geopolitical tensions between the U.S. and China have led global manufacturers to look beyond China, and Indian Prime Minister Narendra Modi has seized this opportunity. His government has allocated 20 percent of its budget this fiscal year towards capital investment, the highest level in a decade. As Sino-U.S. competition intensifies, India is poised to become an economic powerhouse. Analysts believe that with companies withdrawing from China, India and Vietnam will be the biggest beneficiaries. The Modi government has offered incentives to Apple’s three major Taiwanese suppliers, resulting in a more than double growth in iPhone production and exports in India, reaching $2.5 billion from April to December last year. JPMorgan Chase predicted last year that by 2025, a quarter of Apple’s products will be made outside of China, significantly higher than the current 5 percent. In 2017, Apple opened an iPhone assembly plant in India through Wistron and has since partnered with Hon Hai to expand its assembly operations in India, in line with the Indian government’s push for local manufacturing. India’s Tata Group has been in talks with Wistron for months and hopes to complete the acquisition of its Indian iPhone assembly plant by the end of March this year. If successful, the Tata Group will take over its eight iPhone assembly lines and 10,000 workers, including several thousand engineers.