Enhancing India's Global Value Chain Competitiveness

Launch of USISPF’s Reports on Enhancing India’s Global Value Chain Competitiveness and Shifting GVCs to India


Today, the US-India Strategic Partnership Forum (USISPF) announced two new reports focused on identifying strategies for India to succeed at becoming a reliable manufacturing hub. The two reports are titled, “Enhancing India’s Global Value Chain Competitiveness” and “Shifting Global Value Chains to India”, outlining ways that Indian can enhance its competitiveness in Global Value Chains, along with addressing current challenges related to the country’s Ease of Doing Business (EODB).

The first report, “Enhancing India’s GVC Competitiveness,” highlights that, in the post-pandemic world, global firms’ interest to diversify can fulfill India’s need to make its manufacturing sector more competitive under the “Aatmanirbhar” (Self-Reliance) Initiative while creating numerous high-paying jobs. Through its participation in Global Value Chains (GVCs), India can become a reliable manufacturing hub, but must first enhance its competitiveness. This report offers an analysis of India’s competitiveness in comparison with Thailand and Vietnam in Ease of Doing Business (EODB), Cost of Doing Business, and Labor Markets. It also identifies specific areas of improvement and provides recommendations for Indian policymakers.

The first report makes specific recommendations for:

Enhancing Ease of Doing Business
Improving Labor Productivity
Cutting Cost of Doing Business

The second report, “Shifting GVCs to India,” focuses on the reasons and areas where current gaps are, and how these gaps can be bridged through policy intervention, thereby improving India’s competitiveness. The report provides a comparative analysis and evaluation of the Ease of Doing Business (EODB) in India viz-a-viz Vietnam and Thailand specifically for moving goods across borders in the supply chain. The report focuses on the current regulatory compliance landscape in India around conformity of standards and associated challenges, description of international best practices, recommendations to address the gaps and the expected impact of recommendations on India’s competitiveness as a GVC partner.

Some recommendations in the second report pertain to:

Conformity Assessment of Product Standards
Ensuring Policy Stability
Improving Custom Procedures
Improving Logistics

The two reports assert that addressing these gaps through adoption of global best practices in standards and customs and ensuring a reliable policy environment while enhancing and streamlining logistics, can boost India’s global share of exports, attract investments, and develop its manufacturing sector.

Dr. Mukesh Aghi, President and CEO of USISPF, said “Since coming to power in 2014, Prime Minister Modi has made it a priority to enhance India’s ranking in the Ease of Doing Business Index. Furthermore, the pandemic era has disrupted supply chains, encouraging countries to focus on rebuilding resilient supply chains and economies. These two reports touch on how India has enhanced its fundamentals to improve the business environment and supply chain connectivity. We are confident of the progress made and look forward to working on future reforms with our colleagues in the government and private sector.” While the studies were on the way, the GoI announced certain policy decisions, such as elimination of regulatory provisions of retroactive taxes, roll-out of single-window system and recognition of conformity assessment from foreign labs. USISPF lauds these measures and expects that their full implementation will enhance ease of doing business in India.

The reports were released at a virtual event, which included special remarks by Manmeet Nanda, Joint Secretary, Department for Promotion of Industry and Internal Trade, Ministry of Commerce and Industry; Gaurav Masaldan, Joint Secretary (Customs), Department of Revenue, Ministry of Finance and Saurabh Gaur, Joint Secretary, Ministry of Electronics and Information Technology. An interactive industry discussion was moderated by Atul Dhawan, Chairperson of Deloitte India.

About the U.S.-India Strategic Partnership Forum (USISPF)

The US-India Strategic Partnership Forum (USISPF) is committed to creating the most powerful partnership between the United States and India. As the only independent not-for-profit institution dedicated to strengthening the U.S.-India partnership in Washington, D.C. and in New Delhi, USISPF is the trusted partner for businesses, non-profit organizations, the diaspora, and the governments of India and the United States.

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