"Relocating factories is easier than relocating industrial ecosystems." Examine this with reference to India's ambitions under the China+1 paradigm.

Under China+1, firms set up a second production base outside China to reduce tariff and geopolitical risk. Between 2017 and 2022, China's share of US imports fell from 22% to 16%. Yet the countries that replaced China were those most deeply tied into China's own supply chains [1]. The statement holds: an assembly line can move in months, but the suppliers, skills and logistics behind it cannot.

Why ecosystems resist relocation

• Parts stay Chinese: over 60% of China's exports to the Asia-Pacific are intermediate goods. In Vietnam and Bangladesh, sectors hit by US tariffs raised exports to the US, and their imports of Chinese inputs rose too [2].
• Reorganisation, not exit: Chinese-led chains are being reorganised through third countries rather than dismantled [3].
• Clustering advantage: suppliers, tooling and skilled labour located close together cut cost and lead time. A single relocated plant loses these benefits.

India under China+1: gains and gaps

• Gains: the WTO lists India among the beneficiaries [3]. Electronics output roughly doubled between FY17 and FY23, led by mobile phones [4].
• Missed first wave: in tariff-targeted sectors (2018–23), India's value-added exports to the US grew about 20% less than in its other sectors. Vietnam, Bangladesh and Cambodia gained about 20% [2].
• FDI openness decided winners: the countries that gained also attracted more Chinese FDI projects [2]. India's Press Note 3 (2020) required government approval for FDI from countries sharing a land border [5].
• Trade friction: South Asia has the highest non-tariff barrier score of any region (about 14–15 on a 0–20 index) [2].
• Assembly-heavy: India has under 1% of global electronics exports. NITI Aayog wants $150 bn of its $500 bn 2030 target to come from components [4].

Way forward: from factories to ecosystems

• Calibrated FDI: build on the 2026 easing of Press Note 3 (automatic route for non-controlling stakes up to 10%) [5]. Screen chips and telecom strictly; open low-risk parts.
• Support lower tiers: move PLI support towards components and design capability [4].
• Trade integration: cut NTBs, deepen trade agreements and diversify import sources [2].
• Traceability: as rules of origin are applied more strictly [2], mapping suppliers several tiers deep becomes a competitive edge.

China+1 shows that production follows ecosystems, not the other way round. By combining selective openness with a component-led industrial policy and deeper regional integration, India can turn assembly gains into lasting value addition. This would advance Make in India and SDG 9 on resilient industry and innovation.