Reference News website reported on May 26 that the US Consumer News and Business Channel website published an article titled "Why India's Manufacturing is Not Necessarily Successful Despite US Tariffs on China" on May 22. The author is Ganesh Rao. The content is compiled as follows: President Donald Trump of the United States has never been one to hide his opinions. Last week, when visiting Qatar, Trump said: "I had a little problem with Tim Cook yesterday." He was referring to his conversation with Apple's CEO about the company's decision to move iPhone manufacturing from China to India instead of the U.S. Trump told Cook: "I don't want you building factories in India." There were reports that Apple decided to expand production in India, aiming to produce about 25% of iPhones in India in a few years and reduce dependence on China. Currently, Apple assembles approximately 90% of its flagship smartphones in China. Undoubtedly, India has become an important electronics assembly center at this stage. However, it is not a certainty that India will clearly replace China despite the US tariffs on Chinese goods. For both India and companies reviewing India, geopolitical turbulence seems to be one of many obstacles. For Apple, moving production from China to the U.S. rather than India remains possible, though the likelihood is low. Analysts at Bank of America stated that if Apple relocates its final assembly line to the U.S., due to higher labor costs, the cost of the iPhone may increase by 25%. This is assuming that subcomponents like cameras are still partially assembled outside the U.S. Wamshi Mohan of Bank of America said in a report to clients: "If Apple indeed relocates its final assembly line to the U.S., global tariffs on parts/subcomponents must be waived for the transfer to be feasible." Although technically feasible, Mohan believes that transferring the entire iPhone supply chain to the U.S. is a "much bigger task" and "even if feasible, it would likely take many years," unless tariff policies become permanent, don't expect a shift in manufacturing to the U.S. in the short term. The core challenge facing India is not just attracting businesses. Nick McConway, head of Asia-Pacific ex-Japan equities at Amundi Asset Management, said: "Supply chains and manufacturing take a long time to build. The lights need to be on, there must be roads, and trucks must arrive on time." McConway also said: "I think India is still in the very early stages of developing such globally-oriented manufacturing capabilities. While your labor costs may be low, your unit labor costs are not low because productivity is not high." This productivity gap could offset the advantage of cheap labor, making it difficult for India to effectively compete in high-value global manufacturing. An analyst stated that even if India wins a larger share of Apple's iPhone assembly business, the benefits to the country are likely to be minimal. Ajai Srivastava, founder of India Global Trade Research Initiative, said: "Today, India makes $30 per iPhone, much of which is returned to Apple as subsidies under the Production-Linked Incentive (PLI) program." Srivastava, a former Indian trade negotiator, holds a protectionist stance, believing that lowering smartphone component tariffs at New Delhi's request may harm efforts to establish a domestic component ecosystem in India. Ultimately, it may not be Trump's push for reshoring manufacturing to the U.S. that causes India to lose foreign investment. The country needs to work harder to attract investors. Original source: https://www.toutiao.com/article/7508710234950271525/ Disclaimer: The article represents the views of the author. Feel free to express your opinion by clicking the "Like/Dislike" buttons below.