China decoupling gains pace; India now R&D world capital

Spread the love

By Manish Anand

New Delhi, December 10: India has outpaced China in attracting foreign direct investment in research and development. De-coupling of China from the global supply chains also looks taking firm roots. India and the US bonhomie is helping New Delhi take giant leaps in attracting the R&D FDI.

In the current year, China attracted just 17 R&D FDI projects from the US-based companies, industry sources said. India in contrast attracted a whopping 153 such projects. The scale is too heavy leaning in favour to ignore the fact that the US is accelerating de-coupling China from the global supply chains.

Financial researchers have noted that the post-pandemic reset in the flow of the investment is now fast aligning to the changing global order and also an aversion to China on the back of its President Xi Jinping undoing the gains of Beijing when the country was helmed by Hu Jintao by showing the military teeth to the world. From software to banking, from critical technology to manufacturing, the US-based companies are shunning China and opting for alternatives, with a clear preference to India.

Within India, Karnataka has emerged as the top gainer, with a net investment of $2bn in 2022, with most of the projects in the R&D space going to Bengaluru. The state is uniquely placed to attract R&D FDI, for its scientific pool of institutions and laboratories, with over 400 of them spread over public and private space.

Researchers in journals such as Nature have noted that India is also gaining from the fact that the country has kept the Chinese institutions at arms’ length. There is a 20 per cent drop in the research papers submitted globally which are linked to the Chinese institutions, which again demonstrate the world becoming wary of the designs of Xi-led Beijing. India in contrast keeps rising in the global stock, with greater acceptance of its trained manpower in the global capitals such as the UAE, Australia, Germany and the US, which are facing acute shortages of the skilled manpower, which they are sourcing from India. Last month, automative parts manufacturing company Continental had inaugurated a 1000-acre R&D campus in Bengaluru.

It may be recalled that the Quad Summit in Tokyo had brought the US, India, Japan and Australia on a common page to accelerate the reset for the global supply chains with thrust on ‘reliable and resilient’ terms. China’s disastrous Covid-19 management and Beijing’s opaqueness in sharing the source and reasons for the global outbreak of the Coronavirus have turned many of its former allies into foes. India with an adequate policy framework in place may gain from ‘China Plus One’ strategy of the western powers, but the concern appears, as noted by the researchers, that it’s only the southern states which are attracting the investments in big ways and other states still need to wake up and smell the coffee. “This is just the beginning,” said Shashank, former Foreign Secretary of India.


About The Author

1 thought on “China decoupling gains pace; India now R&D world capital

  1. Great coverage on world’s preferred partner for R&D and inestments for growth….good news for us as opportunities shifting from China to India and all this is a happening for a reason, not just a chance.

    Now India taking the lead in grabing the opportunity for high growth, increasing visibility in the global platform and Indian skilled workforce in demand all across the globe….we should not miss this opportunity and all states of India should make the path easier for global investments here.

Leave a Reply

Your email address will not be published. Required fields are marked *