New Delhi: India has an opportunity to cash in on global companies’ efforts to build factories outside China, the new World Bank president said on Wednesday, as firms seek to diversify their supply chains.
His comments follow recent investment announcements by U.S. firms, including chipmaker Micron Technology, in India and come as the United States looks for a strong counterweight to China in Asia amid growing tensions in ties.
In recent years, many companies have adopted a “China Plus One” strategy to build new manufacturing units outside the People’s Republic.
India has a window of three-to-five years to seize this opportunity to attract investment, said Ajay Banga, the former Mastercard CEO who became World Bank chief last month.
“I think India’s opportunity currently is to cash in on the ‘China plus one’ opportunity. This opportunity won’t stay open for 10 years,” Banga told reporters in New Delhi during his first official visit to the country.
Indian Prime Minister Narendra Modi had his first state visit to the United States last month, which coincided with a flurry of investment announcements by U.S. companies in India.
Banga also said that India’s growth has been cushioned by domestic consumption in the face of a global slowdown.
The World Bank chief also called for private capital investments to aid global efforts for renewable energy funding. The lender estimates that $1 trillion will be required by 2030 in developing nations for green energy transition to help achieve net-zero targets.
“The facts remains we will need different forms of concessional capital. We will also need different forms of multilateral bank capital and government capital and philanthropy capital to take first risk positions or help enable the blended finance to come through,” Banga said.
(Reporting by Nikunj Ohri; Writing by Shivam Patel; Editing by Sharon Singleton)