Cisco becomes the latest tech giant to support the Made In India campaign
Networking solutions giant Cisco is planning to set up a manufacturing facility in India, making it the latest tech behemoth to support the Made In India campaign.
“Several companies, including Cisco are evaluating the various incentives offered by the government for investments in the Electronic System Design & Manufacturing (ESDM) sector,” Minister for Communications and IT Ravi Shankar Prasad said.
At present, US-based Cisco’s largest research and development (R&D) facility outside the US is in India. But, it does not have any manufacturing facility in the country.
Cisco, which manufactures wireless access points or modems, has various manufacturing facilities across the globe. The company is worth in excess of $42 billion.
When contacted, a Cisco spokesperson said: “Cisco believes that the government and industry should work together to remove roadblocks and provide enablers so that India can become a leader in manufacturing.”
The spokesperson further added: “Although we have nothing to announce, companies that manufacture on a global scale will always seek to manufacture for the right reasons.”
“Cisco believes that India's world-class engineering talent, along with consistent tax policies and market access, can help the country accelerate its journey towards becoming a manufacturing hub,” the spokesperson said.
Prasad added that 60 companies have demonstrated interest towards investment under the M-SIPS in electronic hardware manufacturing so far and this does not include Cisco.
IMF: Variants Can Still Hurt Manufacturing Recovery
After a year of on-and-off manufacturing in the US, UK, and the eurozone, demand for goods surged early last week. Factories set growth records in April and May, suppliers started to recover, and US crude hit its highest price point since pre-COVID. As vaccination efforts immunise much of the US and UK populations, manufacturers are now able to fully ramp up their supply chains. In fact, GDP growth could approach double-digits by 2022.
Now, the ISM productivity measure has surpassed the 50-point mark that separates industry expansion from contraction. Since U.S. president Biden passed his US$1.9tn stimulus package and the UK purchasing managers index (PMI) increased to 65.6, both sides of the Atlantic are facing a much-welcomed manufacturing recovery.
Lingering Concerns Over COVID
Even as Spain, France, Italy, and Germany race to catch up, and mining companies pushed the FTSE 100 index of list shares to a monthly high of 7,129, some say that UK and US markets still suffer from a lack of confidence in raw material supplies. Yes, the Dow Jones has made up its 19,173-point crash of March 2020, and MSCI’s global stock index is at an all-time high.
Yet manufacturers around the world realise that these wins will be short-lived until pandemic supply chain bottlenecks are solved. If we keep the status quo, consumers will pay the price. In April, inflation in Germany reached 2.4%, and across the EU’s 19 member countries, overall prices have increased at an unusual pace. Some ask: Is this true recovery?
IMF: Current Boom Could Falter
Even as Elon Musk tweeted about chip shortages forcing Tesla to raise its prices, UK mining demand skyrocketed; housing markets lifted; and the pound sterling gained value. The International Monetary Fund (IMF), however, cautioned that manufacturing recovery won’t last long if COVID mutates into forms our vaccinations can’t touch. Kristalina Georgieva, Washington’s IMF director, noted that fewer than 1% of African citizens have been vaccinated: “Worldwide access to vaccines offers the best hope for stopping the coronavirus pandemic, saving lives, and securing a broad-based economic recovery”.
Across the globe, manufacturing companies are keeping a watchful eye on new developments in the spread of COVID. Though US FDA officials don’t think we’ll have to “start at square one” with new vaccines, the March 2021 World Economic Outlook states that “high uncertainty” surrounds the projected 6% global growth. Continued manufacturing success will in large part depend on “the path of the pandemic, the effectiveness of policy support, and the evolution of financial conditions”.
Mathias Cormann, secretary-general of the Organisation for Economic Co-Operation and Development (OECD) concurred—without global immunisation, the estimated economic boom expected by 2025 could go kaput. “We need to...pursue an all-out effort to reach the entire world population”, Australia’s finance minister added. US$50bn to end COVID across the world, they imply, is a small investment to restart our economies.