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Economy

Apr 08, 2003
Not by software alone

How often have you heard this: “India may be a leader in software exports, but when it comes to old fashioned manufacturing, China is ahead.”—and how often you nearly believed it. Well, GoodNewsIndia was always convinced that that was a myth.

If ‘knowledge’ is what is driving India up the software ladder, it can power India in manufacturing too. GNI has expressed this through its many stories, links to which are listed below.

Now comes another confirmation of how India’s knowledge-edge is making it a success in the $3 trillion global auto-parts industry as well.

A Reuters report on April 1, 2003 details how auto majors are reaching out to India as a source of quality, engineered products. Volvo expects to shop for $1 billion from India and Mexico. Delphi—a GM parts company-- aims to export upto Rs. 250 crores in three years. Toyota is investing $74 million to manufacture and export precision transmission systems. Maruti plans to supply parts to its plants across the world. Similar reports come from Ford and Daimler-Chysler. The report quotes the President of the Automotive Components Mfg. Association as saying, “we are addressing at least two foriegn delegations a month.” Indian companies like MICO, Bharat Forge and Sundaram Fasteners have emerged as reliable suppliers as well.

All this is not because of cost advantage alone—although there is that as well, as much as 15 to 25% over the West. The true reason lies in this quote: “The country has increased quality control and improved delivery times, cheap labour costs, a pool of English-speaking engineering graduates, and a booming local software industry that can design and develop electronic parts… Foreign companies are also looking at China to buy parts, but India is higher up ‘the quality ladder’...”
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A Jan 15,2003 article reported growing sophistication of some Indian manufacturing businesses.

A Jan 01, 2003 report disclosed that the Global Competitiveness Report for 2002-03 showed India going up the ranking list.

In July,2001 GoodNewsIndia reported how Professors Jeffrey Sachs and Michael Porter picked India ahead of China for the long term.

In May, 2000 this article discussed the implication of India’s knowledge assets

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