CAUSE
One question. One truth.
“Why is manufacturing weak in India compared to China?”
India's manufacturing sector lags behind China's due to lower industrial productivity and inefficient infrastructure. This results in double the logistics costs and less output per worker, despite average manufacturing labor costs of approximately $3 per hour in 2024.
High confidenceStructural
CURRENT STATE
India's manufacturing productivity is approximately half that of China's. Logistics costs are 13-14% of GDP compared to China's 8-9%. Consequently, India's manufacturing contributes around 12-13% to its GDP, with a global output share under 3%, while China's share is above 25%.
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