India is capitalising on the US-China trade tensions by offering incentives to companies to relocate from China to India.
Financial incentives such as preferential tax rates and the tax holiday provided by Vietnam to lure companies are among measures being considered, the person said, asking not to be identified as the discussion is still private. Industries identified for incentives include electronics, consumer appliances, electric vehicles, footwear and toys, according to a trade ministry document seen by Bloomberg.
The plan will help grow India’s manufacturing base and will aid Prime Minister Narendra Modi’s flagship ‘Make in India’ initiative, which aims to boost manufacturing to 25% of the economy by 2020. Doing that will help India narrow its huge trade deficit with China, its largest commercial partner.