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China’s threat to Indian manufacturing

India has made impressive progress in raising its share of global high-end electronics exports over the past few years. But, worryingly, it has failed to capture any additional market share in the lower-end manufactured goods which are typically more labour-intensive. Part of the problem is that Chinese firms have become more productive by making these goods more capital intensive, which has made it harder for Indian firms to compete. This highlights the need for the next government to step up the pace of structural reform.

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