Enhancing India's Global Value Chain Competitiveness Report

India can become a reliable manufacturing hub through augmenting its participation in Global Value Chains (GVCs), for which it will need to enhance its competitiveness. Post-COVID dynamics present numerous opportunities to India and other Asian economies to host global manufacturers; however, global manufacturers will establish their manufacturing facilities where business climate is conducive to manufacturing, the cost of doing business is least and labor markets are favorable for manufacturing activities. This Report offers an analysis of India’s competitiveness viz-a-viz Thailand and Vietnam in Ease of Doing
Business (EODB), Cost of Doing. Business and Labor Markets, identifies areas of improvement, and provides specific recommendations for the Indian policy interlocutors to improve India’s competitiveness in these areas for increasing participation in GVCs, specifically in hi-tech sectors, such as defense, electronics and medical devices.

Post-COVID, the global firms’ interest to diversify can fulfil India’s need to grow its manufacturing sector under the “Aatmnirbhar” (Self-Reliance) Initiative while creating numerous high-paying domestic jobs. Through participation in global value chains, India can reap benefits of global integration and increase its share in global trade while making the domestic industry more competitive, especially when COVID has led to an above-average adoption of automation and digitization of work processes in India. According to The USISPF Hi-Tech Manufacturing in India Report, the hi-tech sectors in India have the potential to offer an additional investment of US$21 billion and create 550,000 direct jobs and 1,400,000 indirect jobs over the next five years.