On shifting manufacturing and supply chain to India
India built the factories faster than the managers.
The manufacturing story here is real and the numbers are not marketing. What hasn’t kept pace is the supply of people who have run any of it, and the incentives are actively pushing new plants toward the places where that’s hardest.
The scale-up actually worked
It’s worth being clear that this isn’t an announcement-driven story. Electronics manufacturing production rose 146% from ₹2.13 lakh crore in FY21 to ₹5.45 lakh crore in FY25, roughly $25.7 billion to $65.7 billion.
India is now the second largest mobile phone manufacturer in the world, with more than 300 manufacturing units operational, having gone from importer to net exporter since 2014. The production-linked incentive programme behind it carries an outlay of ₹1.97 lakh crore across 14 sectors with 806 approved applications.
Semiconductors are following the same pattern. The Semicon India programme runs to ₹76,000 crore, with fiscal support of 50% of project cost for silicon CMOS fabs.
So if you are looking at India as an alternative to a China-concentrated supply chain, the industrial base you would be joining is considerably deeper than it was five years ago, and that much of the pitch survives contact with the numbers.
The bench didn’t grow at the same rate
Production capacity can be built with capital in about two years. The population of people who have run a plant to international quality standards, managed a supply base here, and held a regulator’s attention cannot.
Most of that experience sits inside a small number of large domestic groups and the contract manufacturers who scaled with the incentive programme. Those people are not on the market, they are not looking, and their employers know exactly what they are worth.
The services sector has the same problem, and it is easier to see there: Indians hold only around 10 to 13% of leadership positions in global capability centres. Two decades of foreign companies operating here without handing over authority produced deep operational skill and a thin layer of people who have carried final responsibility.
For a first plant that matters more than it does for a tenth one. You’re hiring someone to make judgment calls about quality, safety and suppliers in a country your head office doesn’t understand, usually before there’s anyone senior on the ground to check their work.
The incentives push you where hiring is hardest
The policy design deliberately spreads industrial activity outward. The incentive programme is credited with fostering ecosystem development across tier-two and tier-three cities, and land, power and state-level support are all easier away from the established hubs.
That’s good industrial policy and an awkward hiring problem. Senior manufacturing leadership concentrates where the industry has been longest. Asking someone to move their family to a new industrial cluster for an unknown foreign employer is a much harder conversation than asking them to change buildings in a city they already live in.
It’s solvable, and the solution is usually money plus something the incumbent can’t offer: a bigger job than they currently have, or the chance to build something rather than maintain it. But it has to be planned for at the point the site is chosen, not discovered afterwards when the offers start getting declined.
What I’d think about before starting
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Whether you need a builder or an operator
- Commissioning a plant and running one are different jobs with different people. Companies routinely hire the operator first because the job description is easier to write, then discover that the first eighteen months are entirely construction, vendor qualification and hiring.
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How many decisions actually move with the job
- Manufacturing leaders here have watched foreign parents retain every meaningful decision while calling the arrangement a partnership. Candidates will probe this. If quality and supplier decisions will still be made abroad, say so, and hire someone who is content with that rather than someone who will leave when they find out.
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Whether the timeline is yours or the tariff’s
- Supply chain shifts driven by external deadlines compress hiring into a window that senior hiring does not fit into. Worth knowing at the start whether you have the time to get the right person or only enough to get an available one, because those lead to different searches.
The judgment
The industrial case for India is much stronger than it was, and the incentive money is real rather than announced. What hasn’t caught up is the number of people who have carried responsibility for any of it.
Which means the hard part of a China-plus-one move here is not the plant. It’s the four or five people who will run it, and the fact that most of them currently work somewhere that has no intention of letting them go.
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