Indian Prime Minister Narendra Modi is reportedly preparing a series of business-friendly reforms if he secures a third term this week, aiming to rival Chinese manufacturing dominance, according to government officials familiar with the matter.
As part of his election pledge to transform India into a global manufacturing hub, Modi intends to implement measures including easing regulations to make it simpler to hire and fire workers, the officials said on condition of anonymity.
Modi also plans to introduce subsidies for domestic production, inspired by recent packages for semiconductor firms and electric vehicle makers. Additionally, he aims to reduce import taxes on crucial inputs for locally-made goods, which have inflated India's manufacturing costs.
Exit polls suggest that Modi's right-wing coalition, led by the Hindu nationalist Bharatiya Janata Party (BJP), will secure a significant majority when election results are announced on June 4.
Modi's reelection campaign emphasized continued economic growth, positioning India as an alternative manufacturing destination for global firms looking to diversify their supply chains away from China.
India is currently the world's fastest-growing major economy, encompassing a thriving tech sector alongside an older economy struggling to generate sufficient employment opportunities, according to Josh Felman, former head of the International Monetary Fund's office in India.
Felman highlighted the importance of manufacturing in creating good jobs for the populace. India has successfully attracted suppliers for major U.S. corporations like Apple Inc and Alphabet Inc's Google. However, World Bank data shows that less than 3% of global manufacturing occurs in India, compared to China's 24%.
As per reports, the government aims to increase India's share of global manufacturing to 5% by 2030 and 10% by 2047, though specific strategies were not detailed.
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