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US and European MNCs now consider India an alternate option to China: PwC Asia Pacific


A growing number of US and European multinationals are now considering India as an alternative to China and a potential investment destination, said Frank Debets, managing partner-customs & trade practice at PwC Asia Pacific.

In an interaction with ET, he said 5-10 years back when companies wanted to set up a base in Asia, India would not be on the list and they would look at Vietnam or Australia. But this has changed now.

“What I have seen certainly in the past 5-10 years is that India is more often coming up as a place of counter-opportunity and being that market (China Plus One) in its own right and as a potential for investment, and many more internationals would say, ‘we can have an India base also to supply other region, be it the Middle East, be it East Asia,” Debets said.

He said many multinationals feel that they invested too much in China and there is a need to diversify to other locations to minimise risk.

But just subsidies or incentives are not enough for multinationals to shift their base to a country, he said, adding that companies focus more on the economic realities of that country.

“Ultimately, if you don’t have the right customer base, if you don’t have the supply base, if you don’t have infrastructure, that is where companies look at when they are deciding where they are going, not just can I get a subsidy or can I get this benefit,” he added. He said India has made remarkable progress in terms of customs clearances, especially with faceless customs. “Faceless customs has made an enormous difference in India. So suddenly, a country that was known to be very administratively driven and practically difficult, clearance went overnight to something where you could just go through with electronic documents,” Debets said.


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