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Shifting Gears: Why Manufacturing Companies are Choosing India over Singapore


In recent years, there has been a notable trend of manufacturing companies relocating their operations from Singapore to India. This shift signifies the growing attractiveness of India as a manufacturing destination, driven by favorable government policies, a strong economic outlook, disruptions caused by the COVID-19 pandemic, and India’s ambitious “Make in India” campaign.

Reasons why manufacturers want to shift to India

1. Favorable Government Policies:

  • India’s government has implemented various policies and initiatives to promote manufacturing and attract foreign direct investment (FDI). The “Make in India” campaign, launched in 2014, aims to position India as a global manufacturing hub.
  • It offers incentives such as tax benefits, streamlined regulatory processes, special economic zones, and relaxed foreign investment norms, making it an attractive destination for manufacturing companies.

2. Growing Consumer Market: 

  • With a population of over 1.3 billion and a rapidly expanding middle class, India presents a significant consumer market. Manufacturing companies see the potential for increased sales and market penetration by establishing their operations in India.
  • The demand for consumer goods, automobiles, electronics, and other products is on the rise, providing companies with opportunities for growth and profitability.

3. Cost-Effective Skilled Labor: 

  • India is known for its abundant pool of skilled and semi-skilled labor. Compared to developed countries and even some neighboring countries, labor costs in India are relatively lower.
  • Manufacturing companies can take advantage of this cost differential to reduce production expenses and enhance competitiveness.
  • The availability of skilled labor across various sectors, including engineering, technology, and manufacturing, further supports the move to India.

4. Diversification of Supply Chains: 

  • The COVID-19 pandemic highlighted vulnerabilities in global supply chains heavily reliant on a single source, primarily China.
  • Manufacturing companies are seeking to diversify their supply chains to mitigate risks and ensure business continuity.
  • India’s capabilities in various industries, such as pharmaceuticals, textiles, electronics, and automotive, make it an appealing destination for companies looking to establish alternative manufacturing bases and reduce dependence on a single market.

5. Supportive Infrastructure Development: 

  • India has been investing in infrastructure development to support its growing manufacturing sector.
  • Initiatives like the Dedicated Freight Corridor, development of industrial corridors, improvement of port facilities, and expansion of road networks are enhancing logistics and connectivity within the country.
  • These infrastructure developments facilitate the movement of goods and reduce transportation costs, making India an attractive option for manufacturing companies.

6. Rising Digital Adoption

  • Another compelling aspect is India’s rising digital adoption across various sectors.
  • From financial inclusion to healthcare advancements and governance at the grassroots level, initiatives like UPI (Unified Payments Interface) and ONDC (Open Network for Digital Commerce) showcase India’s technological prowess.
  • This digital revolution further facilitates seamless business operations and innovation for manufacturing companies.


The shift of manufacturing companies from Singapore to India underscores the growing attractiveness of India as a manufacturing destination. Favorable government policies, a strong economic outlook, disruptions in global supply chains, and India’s “Make in India” campaign have all contributed to this trend.

While Singapore offers advantages in terms of its tax system, stability, and infrastructure, India presents unique opportunities in terms of a vast consumer market, skilled labor at competitive costs, and government incentives.

As more companies tap into India’s manufacturing potential, it is expected to generate employment opportunities and further bolster India’s position on the global manufacturing map.


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