Global Economy World Economy
3 Dec, 2010
India is slowly emerging as the new destination for global manufacturing. A study conducted by Deloitte and the US Council on competitiveness has shown that India ranks second, led by China, in manufacturing competitiveness and will only narrow the gap over the next few years. Based on the views of more than 400 senior manufacturing executives worldwide, the Global Manufacturing Competitiveness Index has rated the manufacturing competitiveness of 26 countries.
According to the study, India is positioned at number two and is expected to gain an even stronger foothold over the next five years; India's rich talent pool of scientists, researchers, and engineers as well as its large, well-educated English-speaking workforce and democratic regime make it an attractive destination for manufacturers. India's research and development capabilities paired with engineering, software, and technology integration abilities have been essential ingredients for manufacturing enterprises. India is now being viewed as an integral part of the global manufacturing enterprise and location strategy.
The report added, "These factors explain, in part, India's rise from a low-cost, back-office location to a country that is well-positioned to be an active participant in the entire value chain as well as it now being viewed by many executives as an integral part of their global manufacturing enterprise and location strategy".
Brazil is expected to replace US from the fourth slot, while China, India, and South Korea retain their position as the three most competitive manufacturing economies of the world. US is expected to slip to the fifth slot in the wake of rising concerns over the country's losing competitiveness.
The study reinstates that the most important drivers of global manufacturing competitiveness are the classic factors of production labor, materials, and energy.