India iPhone breakthrough masks struggle to be next China
On paper, India's chances of attracting global manufacturers look rosy.
Apple Inc. began assembling its latest iPhone models in the South Asian nation in a significant break from its practice of reserving much of that for giant Chinese factories run by its main Taiwanese assemblers, a key win for Prime Minister Narendra Modi's “Make in India” campaign.
Among India's advantages are rising geopolitical tensions between Western nations and China, and a growing friendship with the US, Australia and Japan, which form part of the Quad, a grouping of democracies to counter Beijing's economic and military ambitions.
The country's presidency of Group of 20 nations this year could also boost investor confidence. India is poised to hold the title of the world's fastest-growing large economy in the next three years. Its gross domestic product is set to become the world's third-largest before the end of the decade.
But experts warn that lasting gains to improve a sluggish manufacturing sector are still a ways off for India, soon to overtake China as the most-populous nation. Modi's Make in India campaign, which aims to increase exports and create jobs, hasn't quite panned out. Manufacturing accounts for 14% of the economy, a figure that's barely budged in decades. And despite India's massive demographic dividend, unemployment remains stubbornly high.
Since Make in India launched in 2014, the deadline for one of its key goals — to lift the share of manufacturing in GDP to 25% — has been pushed back three times, from 2020 to 2022 to 2025.
Amitendu Palit, an economist specializing in international trade and investment at the National University of Singapore, said decoupling from China has “not yet been pronounced.” In other
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