Pervasive technology, bilateral, multilateral and regional trade pacts and domain expertise have made global sourcing and manufacturing irreversible, India's Commerce and Industry Minister Anand Sharma said in Bangalore Monday.
"Though there is talk about manufacturing returning to Europe and the US due to job losses and economic downturn, trend of global sourcing of capital, raw materials and labour for products and services is irreversible, as they have become part of the global supply and value chains," Sharma said at a trade meet.
Inaugurating the 20th edition of the Confederation of Indian Industry (CII) partnership summit, he said global manufacturing was not depended on labour and capital alone, as technology and innovation had overcome their barriers.
"As developing and emerging economies such as China, India and countries in Africa and Latin America advance on technology and innovation, their competitiveness will go up," Sharma said kickstarting the three-day annual flagship event of India Inc.
Noting that 1.5 billon new consumers would enter global markets, mostly from Asia in the coming years, he said the opportunity would transform the region, riding on its demographic dividend, liberal economic policies and improved infrastructure.
"These favourable factors will make Asia the fulcrum of manufacturing activity in the world. For India, where manufacturing is driven largely by small and medium enterprises (SMEs), it is imperative to integrate them into global supply and value chains," he told about 1,000 delegates from 40 countries participating in the summit.
In spite of China and East Asia being at forefront of emerging supply chains, Sharma said new opportunities would come for them from Africa, as its nations were aspiring to value-added manufacturing-led economy from a commodity driven trade.
"India has a huge advantage of historical linkages with Africa, which are taking shape of a robust economic partnership. Experience of last two decades has shown we are witnessing an unprecedented churning in the nature of manufacturing and only companies and countries, which have ability and resilience to adapt and transform, will retain leadership position," he said.
As key element for integration in value chains would be efficient supply chain, robust logistic services and world class infrastructure, he said industrial corridors were being built across the country to link hinterland with ports and build efficient infrastructure for cargo movement.
"Four industrial corridors will link the country from Delhi to Mumbai, Mumbai to Bangalore, Bangalore to Chennai, and Amritsar to Kolkata. We have notified 14 greenfield integrated industrial townships, of which eight are coming up on the Delhi-Mumbai industrial corridor," he said.
Admitting every country would have its strategic interest to secure energy security and food security for self-sufficiency, the industry minister said there were areas or industry verticals in which a country would have maturity to be globally competitive.
"Rise of the automobile industry in Korea and Japan, which gave stiff competition to German and American car-makers is a case in point. The automobile industry in the east Asian region also spreads across transnational value chains. Similarly, the electronic hardware industry of Japan, Korea and China exemplify the altered nature of manufacturing in modern times," Sharma added.