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AuthorDing GangHe is a senior reporter of "People**" and a senior researcher of the Chongyang Institute for Financial Studies of Renmin University of Chinese. This article ** Global Times, January 9.
The rudiments and unfairness inherent in the laws and regulations of the Indian market are being exposed more and more frequently, leaving many foreign companies in India facing a dilemma.
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On January 8, vivo officially launched the news of vivo Y28 5G new machine in the Indian market, and many India** have reported it. They have been almost identical before, with Chinese mobile phone company Xiaomi saying it will start implementing a "three-year strategy" in 2024 to become India's most popular smartphone brand. However,It cannot be ignored that India's malicious crackdown on Chinese mobile phone companies is still escalating, banning apps, recovering taxes, seizing assets, freezing bank accounts, and recently arresting Vivo executives for "money laundering". Why does India, which has attached great importance to the development of the mobile phone industry in recent years, attack Chinese mobile phone companies?
Objectively speaking, the Indian mobile phone market has great development potential, and in recent years, it has been on the rise, so it has become a new market for mobile phone manufacturers from all walks of life. New Delhi also took advantage of its market potential by imposing higher tariffs to force foreign companies to relocate their production lines to India, but when the production lines were transferred, the Indian market became fiercely competitive, and they began to use more and more means to "claim" wealth. The rudiments and unfairness inherent in the laws and regulations of the Indian market are being exposed more and more frequently, leaving many foreign companies in India facing a dilemma.
Mobile phones are one of India's proudest economic achievements. In 2020, India reportedly produced 11% of the world's total mobile phone production, compared to just 3% in 2014. India is now the second largest mobile phone manufacturer after China, with more than 2 billion mobile phones produced from 2014 to 2022. This development is largely due to the strong support of India. According to reports, in order to revitalize the domestic mobile phone industry, India** launched a phased manufacturing plan and increased the import tax on finished mobile products**.
The development of India's mobile phone industry is also supported by foreign mobile phone companies in India. Whether it is Apple or other Chinese mobile phone companies, after being asked to transfer supporting manufacturers to India, the number of technicians sent to India has increased significantly. They are also involved in the training of Indian workers, which has helped India upgrade its weakest link in the manufacturing sector – the level of its workforce.
It is important to note that we also need to look at two more data pieces to take a holistic look at India's "significant progress" in mobile phones and their manufacturing industries. According to reports, China's share of the global manufacturing industry in 2021 was 31%, and India's was 3%. This share of 31% was developed from 6% in 20 years in China. India, on the other hand, reached 3% in 2018 and still maintains a roughly share in 2021. It is also worth mentioning that India's ** deficit with China exceeded $100 billion in 2022 and is likely to increase.
These numbers show thatThe development of India's manufacturing industry is mainly concentrated in the mobile phone and electronics industries, and it is difficult to say that other manufacturing industries have made significant progress, and the comprehensive capacity of its manufacturing industry is still limited. Moreover, India's mobile phone industry mainly relies on assembly, and the production of parts and components is heavily dependent on imports from China and other countries.
There is no doubt that when we see the above-mentioned changes in investment in India, we must take into account that the United States is trying to squeeze "Made in China" out of the market through the restructuring of the industrial chain and the first chain, which is also one of the main reasons for the transfer of the world's major mobile phone manufacturers to India. However, this transfer will not be smooth sailing in India. The production capacity and labor level of its supporting products are all key factors. India lacks a large pool of workers who are practical, efficient, disciplined, good at learning and mastering the skills of the job. These are also the advantages of China's manufacturing industry. As the United States accelerates the adjustment of the industrial chain and the structure of the first chain, the advantages of China's manufacturing industry have become particularly important.
China's manufacturing industry has accumulated the energy to move towards the high-end, and has the ability to continuously innovate and adapt to the supporting facilities and guide the low-end production capacity of the market. At the same time, China's manufacturing industry has cultivated a large number of high-skilled talents in years of development. For example, among Apple's 200 core merchants, about 1 4 are Chinese manufacturers, who master international leading technology and compete through technology and pricing.
At present, China's manufacturing industry is facing major challenges, and must not be manipulated and guided by Washington, otherwise it may lead to the fragmentation of China's industrial chain that has been established and has a complete system. We need more concrete policy measures to help manufacturers keep their core technologies at home, stabilize their workforce of highly skilled workers, and coordinate with manufacturers who may follow the leading players in moving their parts production lines overseas. Relevant departments and localities** need to do some detailed evaluation of these production lines to support the core supporting technologies and products in the industrial chain to stay. At the same time, it can be suggested that some enterprises with the idea of transfer should give priority to the central and western regions of our country.
Retaining these companies, technologies and personnel is essential to maintaining and consolidating "Made in China". This will give us the ability to mount a strong counterattack against India's illegal treatment of Chinese companies and withstand the onslaught of Washington's attempts to "decouple" from China.