India is applying its recent experiences with trade fragmentation to drive local manufacturing. The idea is to make manufacturing globally competitive. A host of infrastructure and policy issues that have hobbled manufacturing have been addressed, and GoI is committed to making it easier to do business. The country is emerging as a manufacturing export base for industries such as automobiles and electronics. Some products are designed for the Indian market and then exported once they establish themselves locally. This applies across industries from food to finance that benefit from virtuous localisation. McDonald's vegetable protein slice is a recent example of innovation for the challenges the Indian market poses for global food companies.
The size of India's market makes localisation critical. Idiosyncrasies of the market can work as an entry barrier, but on the flip side, once a global brand establishes its presence in India, it opens growth opportunities through customisation. The real gains are to be made when products crafted in India are exported. The learnings from the Indian market are invaluable in prying open more growth markets in the developing world. This gives India a distinct advantage in positioning itself as an export hub for both advanced and emerging economies.
Policy is pursuing higher value addition in emerging sectors such as semiconductors and sustainable energy. These sectors do provide visibility to Indian manufacturing, but there is a fat tail to Indian exports that is built with local know-how. These are typically frugally engineered products that can take on higher-priced competition. The objective is to climb the value chain without losing the competitive advantage. Investments in innovation - McDonald's plant-based protein slice is a collaboration with a state research laboratory - can extract greater export value. The value proposition lies in serving protein to a population that is deficient in that food group. If it is made and sold in India, chances are the product can be sold in many parts of the world as well.
The size of India's market makes localisation critical. Idiosyncrasies of the market can work as an entry barrier, but on the flip side, once a global brand establishes its presence in India, it opens growth opportunities through customisation. The real gains are to be made when products crafted in India are exported. The learnings from the Indian market are invaluable in prying open more growth markets in the developing world. This gives India a distinct advantage in positioning itself as an export hub for both advanced and emerging economies.
Policy is pursuing higher value addition in emerging sectors such as semiconductors and sustainable energy. These sectors do provide visibility to Indian manufacturing, but there is a fat tail to Indian exports that is built with local know-how. These are typically frugally engineered products that can take on higher-priced competition. The objective is to climb the value chain without losing the competitive advantage. Investments in innovation - McDonald's plant-based protein slice is a collaboration with a state research laboratory - can extract greater export value. The value proposition lies in serving protein to a population that is deficient in that food group. If it is made and sold in India, chances are the product can be sold in many parts of the world as well.
