The China decoupling paradox: why the world still needs its manufacturing machine

Talk of global decoupling from China has persisted for years, as has speculation that emerging economies such as India and Vietnam could soon replace it as the “world’s factory”.

But for Indian hardware engineer Neeraj Arora, the growth of India’s electronics manufacturing industry has not eliminated the need to source components from China. Instead, it has changed the nature of those imports.

A decade ago, Arora imported finished phone chargers from the world’s second-largest economy. Today, more of these products can be made in India, even as manufacturers there still rely on Chinese parts for assembly.

“They don’t have a single industry; they have created an ecosystem,” said Arora, who has travelled repeatedly to Shenzhen, Dongguan and Guangzhou – southern China’s manufacturing hubs that offer a wide range of competitively priced parts, from power-switching transistors to charging chips.