NEW DELHI: The Prime Minister’s Office, Niti Aayog and the Department for Promotion of Industry and Internal Trade are framing up a plan to offer incentives to attract companies looking to shift manufacturing activities out of China. India has set up panels to directly interact with firms that may want to shift out of China.
The benefits will be on the lines of those given to manufacture of electronic and medical devices. These may include production-linked incentives such as capital expenditure benefits. There is a growing realisation among multinational firms after the Covid-19 pandemic that capacities cannot be concentrated at one place.
“More sectors could be offered sops on the lines of electronics and medical devices… Those are being worked out. Last year’s corporate tax rate cut and these additional sops would make India with its large market as competitive as Vietnam.”
“A number of countries are now keen that their industry diversifies manufacturing. There is going to be a shift,” the official further added, that India has changed its policies considerably to emerge as an attractive alternative destination.