Rajesh Nambiar: A steady India offers the wobbly world a useful anchor

Mint

5 hours ago

Rajesh Nambiar India's macroeconomic strength, democratic stability, rising innovation and robust talent pool make it a valuable destination for global businesses. This is not just about Apple Inc's iPhone production. Interest in India is increasing across the board. Tim Cook announced in his latest earnings call for Apple Inc that India will become the primary manufacturing hub for iPhones sold in the US.
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The world today is undergoing a recalibration of trade ties. From tariff escalation and geopolitical conflicts to export curbs and volatile commodities, the post-globalization order is fundamentally being reshaped. In the past five years, global businesses have had to rip up more playbooks than they have followed. Yet, despite robust global demand, cross-border business has grown increasingly complex.
The world today is undergoing a recalibration of trade ties. From tariff escalation and geopolitical conflicts to export curbs and volatile commodities, the post-globalization order is fundamentally being reshaped. In the past five years, global businesses have had to rip up more playbooks than they have followed. Yet, despite robust global demand, cross-border business has grown increasingly complex.
Amid this uncertainty, where can businesses find predictability, scalability and resilience? The answer increasingly is India.
Global businesses are shifting East, especially to India, not because India is cheap, but because India has the potential. It stands out as a trusted, open and steady innovation partner. But this is not only about resilience. It is about readiness.
In 2020, a moment of collective transformation unfolded almost overnight as a billion Indians moved their lives online. Classrooms went virtual, groceries were ordered through apps, offices went digital and payments were made with a fingerprint. Yet, the network held steady, systems scaled efficiently and people adapted swiftly. It was proof of preparedness.
India is no longer the world's back office. With Silicon Valley giants building their largest hubs here and global capability centres (GCCs) driving global digital operations, India is becoming the brain and increasingly also the backbone of global tech.
When Tim Cook announced in his latest earnings call for Apple Inc that India will become the primary manufacturing hub for iPhones sold in the US, it was not just another big multinational shake-up story. It exemplified the rising tide of interest that corporations and governments are showing in doing business with India. Just days before, US pharma major Eli Lilly set up its second Indian GCC in Hyderabad.
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Stability and innovation: India's macroeconomic stability has positioned it as one of the most resilient large economies globally. While global growth is set to slow, India is defying the trend. Its relatively low dependence on external trade provides a buffer against global disruptions. Its economy's consumption-led growth model driven by domestic demand provides a natural cushion against external shocks.
Further, India is deepening its economic integration strategically. Recent free trade agreements with the UK, UAE and Australia have gone beyond mere tariff concessions, encompassing critical areas like services, digital trade and investment—hallmarks of a tech-forward economy. Simultaneously, India is expediting discussions with the US on a trade agreement.
India's role in shaping global tech: The case for investing in India has never been more compelling. With a median age of 28, India's demographic dividend offers a clear edge over ageing economies like in Europe. This tech-savvy user base is primed to adopt and scale emerging technologies and AI solutions.
Tariffs may disrupt the movement of goods, but they don't obstruct the flow of talent, intellectual property or digital services—areas where India holds an advantage. Multinationals looking to de-risk supply chains are increasingly finding India to be a rational alternative not just for cost reasons, but for its capabilities and strong governance.
With over 1,750 GCCs currently, it is clear that global enterprises increasingly view India as a critical hub for talent, innovation and operational excellence.
A robust talent and DeepTech pool: India's vast pool of STEM graduates is driving innovation across sectors—from EVs and pharmaceuticals to advanced digital products. This talent base positions India as a top choice for multinationals scouting for programming expertise and/or locations to set up global IT centres. Indian developers are among the largest contributors to platforms like GitHub. By 2028, India is projected to surpass the US to become the world's largest developer community on that platform.
India also hosts the world's third-largest tech startup ecosystem, home to 35,000 such new businesses, 4,000 of them in DeepTech. From Skyroot Aerospace (India's first private rocket launcher) to ideaForge (a UAV leader) and QNu Labs (quantum cybersecurity), Indian startups are setting global benchmarks. With the world's second-highest number of unicorns and a three-fold rise in tech initial public offerings since 2023, India's innovation ecosystem is scaling fast and gaining investor confidence.
The cost of not betting on India: In an era where friend-shoring and de-risking dominate global trade strategies, India offers not only alignment with democratic values, but also strategic economic rationale. Amid today's tariff uncertainty, India enjoys a window of opportunity. It faces lower reciprocal tariffs than many of its competitors, particularly in sectors like electronics; this gives it an edge. While the US pushes for re-shoring, higher export tariffs from countries like Vietnam, Thailand and Taiwan make India more attractive. Though some firms may opt to relocate closer to the US, the risks and costs of such re-shoring remain high.
While no economy is immune to global shocks, India's structural strengths—its young workforce, robust digital stack and deep entrepreneurship—make it a rare constant in an otherwise volatile equation. For global businesses and policymakers, the question is no longer 'Why India?' but 'How fast can we move to India?'
The author is president, Nasscom. Topics You May Be Interested In