Indian Economics Thread II

[siegecrossbow]

Worth noting that the casing factory in question (with 50% defect rate) is located in Tamil Nadu. That's one of the most industrialised states in India, equivalent to Guangzhou's status in China. The only state within India that can rival it in terms of manufacturing depth and sophistication is Gujarat.

So this is as good as it gets if you're a Western firm looking to diversify to India. Thanks to geopolitics, the West is desperate to give India as much business as possible. We'll see how they take advantage of that opportunity, because this is a once-in-a-lifetime moment for them.

Best part is that supposedly they sent in Chinese engineers to help but still can’t fix the issue. LMAO.

 

[Abominable]

I don't know what Apple were thinking choosing India as an alternative to somewhere like Vietnam or Thailand. We all could have predicted this would happen a year ago.

Even if this didn't happen, and Indians became proficient at manufacturing the low technology components of a phone, where would they go from there?

China could block or impose tariffs on export of high tech phone components to India, forcing Apple to send the Indian components back to China. It's going to be very difficult for Apple to divest from China until it has alternative manufacturers that can match production of all components in high volumes.

 

[manqiangrexue]

Yeah, let china to put export tarrif it will only encourage apple and Indian & American government to take out supply chain away from china, it's not secret that after pandemic and russia Ukraine war companies are diversifying away from china under china +1 supply chain strategy, maybe you didn't read why almost of the companies are now fully committed to china+1 supply chain.

No, I don't read these things because when Western media talks, it's basically farting. I read numbers and charts and this one looks dandy to me:

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It will take some time but apple will only put more investment in India because india is also becoming another major market for apple and cheap labour vs china rising cost of labour factor.

Everything won't go smooth in india and chia wasn't good like 20 years ago in electronics, so it will also take time for india and people will adjust. Geopolitics is changing and none of the companies wants to put all of their eggs in one basket, so they're creating alternative supply chain. Beside india there is no other countries that have big growing market and cheap labour.

LOLOL By that logic, everyone just needs more time before they become like China! In actuality, India has had more time and more oppertunities than China. The Indian economy was overtaken by China; they're not the late starter catching up. It is their culture and nature that hinders them from making progress; time is not the obstacle. India as a rival to China has been the democracy's fairy tale for decades but in real life, India falls further behind China every year.

...Indian workers are free thinkers with attitude.

Is that why all the iphone cases coming off an Indian assembly line look different from each other?

 

[siegecrossbow]

No, I don't read these things because when Western media talks, it's basically farting. I read numbers and charts and this one looks dandy to me:

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LOLOL By that logic, everyone just needs more time before they become like China! In actuality, India has had more time and more oppertunities than China. The Indian economy was overtaken by China; they're not the late starter catching up. It is their culture and nature that hinders them from making progress; time is not the obstacle.

Is that why all the iphone cases coming off an Indian assembly line look different from each other?

It’s worse than that. They were cranking out Oppo cases.

 

[siegecrossbow]

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[manqiangrexue]

Yeah, wait until taiwan war occurs then you will see alot of companies moving out from china, they want to diversify their supply chain because of Geopolitical region when war will occurs supply chains will get disrupted, war is just within few years , also they don't want to pay alot of money to Chinese workers.

LOLOL Real situation right now: China is the top manufacturer of the world, and its FDI is increasing. Your imaginary situation has nothing to do with reality.

China wasn't better at electronic manufacturing 20 years ago, hell even by 2010 until 2012 I used to find most of Chinese electronic products garbage even phones were garbage unlike samsung ,LG and HTC .

This just shows that China's quality increases quickly. It has nothing to do with any other country. This is not Usain-Bolt-can-do-it-so-fat-short-people-can-do-it-too. LOL

Apple helped Chinese supplier alot, just look at in 80s when china was only producing clothes but due to trade war with japan china got alot of companies and through USA support they got alot of tech. Most of the tech which it get is due to taking side of America in last code war against Soviet.

Most of the tech came from helping the US against the Soviets but Chinese tech quality drastically started increasing since 2010-2012? Timeline fail LOL

China was so bad at manufacturing in 60-70 that it cannot even be able to produce steel so great leap forward failed.

Hence why India is not the late starter catching up to China; India started ahead of China and got left back. Wayyyy back.

Blocks are going to get created,
Let's lok at Chinese solar tech where USA has imposed sanction, soon after few years alternative supply chain will exist in this field too.

More expensive, worse, non-market competitive. That's what happens when they try to divert away from China for political reasons.

You are going to get huge sanction when war will occur with taiwan, wheather you want to fight or forced to fight but economic sanction from collective west will occur then you can do everything it would be good if you use to stop supply of goods to west which will force companies to move out or even if you don't do anything then still they will move out because of supply chain disruption and home politics and public pressure in west.

LOLOL Keep imagining. The West relies on Chinese goods; if they sanction China, they destroy themselves. This is what China's globalization achieved before we could step forward to challenge the west.

I talk about the reality now. You keep trying to escape into imaginary scenerios...

I can clearly see another supply chain will exist and it's going to be beneficial for india because if china is not going to be part of it then west will seek goods from other region, india can fullfill alot of demands.

Exist? As in the factory exists but it produces reject level goods? LOLOL Yeah, Ok, I can "fulfill alot of demands" by hiring 50 Mexicans to staple together shoes that fall apart in the QC inspector's hands as an "alternate supply chain" but I don't think Nike's too worried about it, just like China isn't worried about India.

 

[Abominable]

Yeah, wait until taiwan war occurs then you will see alot of companies moving out from china, they want to diversify their supply chain because of Geopolitical region when war will occurs supply chains will get disrupted, war is just within few years , also they don't want to pay alot of money to Chinese workers.

China wasn't better at electronic manufacturing 20 years ago, hell even by 2010 until 2012 I used to find most of Chinese electronic products garbage even phones were garbage unlike samsung ,LG and HTC .

Apple helped Chinese supplier alot, just look at in 80s when china was only producing clothes but due to trade war with japan china got alot of companies and through USA support they got alot of tech. Most of the tech which it get is due to taking side of America in last code war against Soviet.

China was so bad at manufacturing in 60-70 that it cannot even be able to produce steel so great leap forward failed.

Blocks are going to get created,
Let's lok at Chinese solar tech where USA has imposed sanction, soon after few years alternative supply chain will exist in this field too.

You are going to get huge sanction when war will occur with taiwan, wheather you want to fight or forced to fight but economic sanction from collective west will occur then you can do everything it would be good if you use to stop supply of goods to west which will force companies to move out or even if you don't do anything then still they will move out because of supply chain disruption and home politics and public pressure in west.

I can clearly see another supply chain will exist and it's going to be beneficial for india because if china is not going to be part of it then west will seek goods from other region, india can fullfill alot of demands.

iPhones were manufactured in China from the very first one back in 2007. The budget Chinese phones you can only afford to buy in your local bazaar aren't representative of Chinese manufacturing capability.

Whatever happens in Taiwan isn't going to change the fact that it's going to take decades to shift large scale production away from China. If America sanctions products made in China all that will happen is they will end up like the USSR where consumer products are either non existent or clearly inferior to those available in countries not sanctioning China.

 

[supersnoop]

I don't know what Apple were thinking choosing India as an alternative to somewhere like Vietnam or Thailand. We all could have predicted this would happen a year ago.

Even if this didn't happen, and Indians became proficient at manufacturing the low technology components of a phone, where would they go from there?

China could block or impose tariffs on export of high tech phone components to India, forcing Apple to send the Indian components back to China. It's going to be very difficult for Apple to divest from China until it has alternative manufacturers that can match production of all components in high volumes.

It's a gamble. Just like China was a gamble in the 80's. You have to play to win. It's as simple as that.
If India turns out to be capable of cranking out iPhones, then you can easily reduce the cost and sell more.

iPhones were manufactured in China from the very first one back in 2007. The budget Chinese phones you can only afford to buy in your local bazaar aren't representative of Chinese manufacturing capability.

Whatever happens in Taiwan isn't going to change the fact that it's going to take decades to shift large scale production away from China. If America sanctions products made in China all that will happen is they will end up like the USSR where consumer products are either non existent or clearly inferior to those available in countries not sanctioning China.

I always like to ask people who talk about "alternative supply chains", Who is paying for it?
You expect companies to foot the bill to build a shipping port in Vietnam? Roads and schools in India? No one wants to pay for the US government's rhetoric.

 

[Abominable]

It's a gamble. Just like China was a gamble in the 80's. You have to play to win. It's as simple as that.
If India turns out to be capable of cranking out iPhones, then you can easily reduce the cost and sell more.

India in 2023 is a much bigger gamble than China in the 1980s. There was no bloated bureaucracy, poor law and order, ethnic and religious warfare, and so on.

India is a big domestic market and many western and Chinese companies alike have been burned investing in it.

I suspect this story is Apple signalling to the US government, "if we can't make iPhone cases in India, how can we make anything high tech?"

I always like to ask people who talk about "alternative supply chains", Who is paying for it?
You expect companies to foot the bill to build a shipping port in Vietnam? Roads and schools in India? No one wants to pay for the US government's rhetoric.

Apple is paying for it, and ultimately it will be the consumer.

Divesting away from China is a political decision not an economic decision, but one that can be imposed by the American authorities.

 

[xypher]

There is like close to zero similarity between China and India apart from the population size, people trying to draw parallels should really try to look beyond the surface level. Starting from blatant work culture & workforce quality ending with government regulations and infrastructure, they are almost 180 from each other and often these differences favour China.

I have seen a comment somewhere saying that "India is always the future country" - and I can't agree more with that statement. I have been hearing this buzz about the "India is the second China" for decades, yet India is still far behind but people somehow think that the long awaited leap is just around the corner and in mere 5-10 years India will be the new manufacturing powerhouse. You might say that "Rome was not built in a day" or something but I would like to point out an example of the IT sector where India has been "the China" for the American tech companies for decades now yet still all their large companies are just IT outsource sweatshops, are there major indigenous Indian software companies even on the local scale? It is as if China would still have zero local brands and just be riddled with contract manufacturers like Foxconn. For all the purported talks of Indian competency in IT (I'm often even seeing people saying that India has edge over China in IT, lol), I'm yet to see any successful Indian company in that sector. I'm not even talking about some global-level players like ByteDance, I would be satisfied with local tech giants that actually make quality products.