India’s Competitive Edge: Can It Outpace China in Low-Cost Tech Production?

World Bank Highlights India’s Manufacturing Potential

India has the potential to manufacture technology at a lower cost than China, provided it efficiently masters production techniques, according to World Bank Country Director Auguste Tano Kouame. He emphasised that India’s large workforce gives it a significant advantage in the global market, making it a strong contender for technology production and export.

Speaking in an exclusive interview, Kouame explained how economic growth influences a country’s competitiveness. He pointed out that as national income rises, labor costs tend to increase, shifting comparative advantages. However, given India’s vast labor force and lower production costs, the country could manufacture and sell technology at a more competitive price than China. “If India masters a particular technology, it will be able to produce and sell it at a lower cost than China. This could position India as a global manufacturing hub,” he stated.

Green Technology and Global Trade: Key Growth Areas

Among the sectors with strong potential, Kouame highlighted green technology as a promising avenue. He noted that India’s growing domestic demand for sustainable solutions creates an opportunity to develop expertise and establish itself as a major global supplier of eco-friendly products. “By focusing on green technology, India can meet domestic needs while simultaneously building a strong position in the international market,” he said.

Additionally, India’s strong trade relationships with multiple nations could further strengthen its global position. If it succeeds in producing high-quality goods efficiently and at competitive prices, it could become a preferred global trading partner. “India should have confidence in its capabilities. Its strong trade ties with various countries can help expand exports if manufacturing efficiency improves,” Kouame remarked.

Overcoming Challenges for Sustainable Growth

Despite its potential, India faces key challenges, including job creation and sustaining economic growth in a volatile global environment. With a rapidly expanding workforce, ensuring sufficient employment opportunities remains critical for economic stability and social progress.

Moreover, India’s export-driven industries must navigate global trade restrictions and slowing international demand. However, Kouame acknowledged that despite these challenges, India has maintained an impressive average growth rate of over 7% over the past few years, even in unfavorable economic conditions.

By implementing structural reforms, investing in strategic industries, and leveraging its workforce, India can enhance its global standing. If executed effectively, the country could not only compete with China but also progress towards its vision of becoming a developed economy by 2047.