Subnostr

Once again, it will take the longest of time - if ever - for any material degree of #china production to migrate into India.

The issue is infrastructure. Chinese rail, roads and ports are among the most efficient in the world. Getting finished product to shelves is shockingly quick. It’s a core factor, as example, why Shein went from zero revenue to $23bn just five years.

Still, expect the “India is the new China” story to continue.

DataNostrum 2y ago

Is infrastructure like rail, ports etc. critical for the high-tech sector? I see how that is required for shipping large volumes of bulky plastic toys, but how much transport infrastructure do you really need to ship a million iPhones per week? Seems like that main limiting factor would be high quality fabs and skilled labor. (But I'm happy to learn, I don't claim to know anything about this)

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Discussion

Peter Alexander 2y ago

The infrastructure is critical for all goods manufactured in China. It’s a genuine competitive advantage. Not to knock India, but a downside to having the worlds largest democracy is that pushing through needed upgrades is challenging to say the least.

Fab plants are an input and could be an issue given US sanctions but China is now the manufacturing center for essentially all goods be they low end (toys) or high end (iPhones). There’s been some “friend-shoring” to places like Mexico. Still, China remains the factory of the world.

Thanks so much for the question.