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New manufacturing hotspots emerge
Amid a diversification push, Southeast Asia and India are luring manufacturers from China

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New manufacturing hotspots are emerging in Southeast Asia and India as companies diversify their operations away from China. This shift is driving a surge in foreign direct investment (FDI) in manufacturing in these regions, with Indonesia and Vietnam seeing significant increases in investment. The desire to create more resilient supply chains and reduce vulnerability to geopolitical tensions is a key driver behind this shift. High-growth industries, such as renewable energy and electric vehicles, are leading the move away from China, with Thailand experiencing a new wave of investment in EV production. Government incentives and free trade agreements are also attracting manufacturers to these new hotspots. Factors such as lower labor costs and access to a diverse talent pool are making India and Southeast Asia compelling locations for manufacturers. These emerging markets are also offering the potential to tap into new customer bases, making them attractive hubs for manufacturers.

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