How Does India Look at China?

Frequent Spend Matters readers know that I consider India to be a significant emerging force in the global sourcing market. And in recent weeks, I've found myself defending India's long-term prospects over cocktails and conversation more than I can remember than in the past. Perhaps it's because Western organizations with significant investments in China are finally getting concerned about currency issues and wage inflation in the area, and their ears perk up when I start talking about the vast Indian opportunity (once you get past the nasty side of the Mumbai airport). Regardless, many are at least open to considering India as a more stable long-term investment from a low cost country sourcing perspective than China.

But what is most fascinating to me is to look at how India views its largest competitor when it comes to supplying the world with goods and services. In Deal With the Dragon Cautiously, a feature article in the The Economic Times this weekend, the authors provide a quick macro foundation for looking at how India views its competitor, while also offering some helpful tips for working with the Chinese. According to the authors, "Compared with India, the main difference is the speed with which Chinese respond. Their focus on the job and discipline with which they conduct themselves are worth emulating." But what the authors don't say is that Indian engineers and business leaders tend to have better academic training which leads to greater innovation (perhaps because of their own outstanding university system) while they also invest more in systems and processes which Westerners can trust (e.g., an ISO certification in India really is an ISO certification). Also, since India actually has a common law system that protects IP at least in theory, companies actually have a motiviation to invest in innovation (rather than just investing in the most efficient means of stealing it). Still, it's good to know that Indian leaders are on their toes, keeping their eye on the "Dragon" to the East.

Jason Busch

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