In the pulsating arena of global trade, two economic giants—India and China—are vying for manufacturing supremacy. The “Make in India” initiative, launched by Prime Minister Narendra Modi in 2014, aims to transform India into a global manufacturing hub, while China’s “Made in China” strategy has long solidified its position as the world’s factory.
As geopolitical tensions, supply chain shifts, and trade wars reshape the global economy, the question looms large: Make in India vs Made in China: Who Wins the Trade War? This article dives deep into the strategies, strengths, challenges, and global implications of this epic economic showdown, exploring whether India can outpace China or if the latter’s manufacturing dominance remains unshakable.
The Genesis of Make in India and Made in China
Make in India: A Vision for Transformation
Launched with fanfare in 2014, the Make in India campaign seeks to elevate India’s manufacturing sector to contribute 25% of the nation’s GDP by 2025, up from 15% at its inception.
The initiative focuses on attracting foreign direct investment (FDI), streamlining regulations, and fostering innovation across 14 key sectors, including electronics, automobiles, and renewable energy. The Production Linked Incentive (PLI) scheme, introduced in 2020, offers financial incentives to companies boosting local production, aiming to reduce reliance on imports—particularly from China.
“Make in India is not just a slogan; it’s a commitment to create jobs, foster innovation, and make India a global manufacturing powerhouse,” said Prime Minister Narendra Modi at the initiative’s launch.
Made in China: The World’s Manufacturing Titan
China’s Made in China 2025 strategy, unveiled in 2015, builds on decades of manufacturing dominance. It aims to transition China from a low-cost, high-volume producer to a leader in high-tech industries like robotics, artificial intelligence, and electric vehicles (EVs).
With state-backed subsidies, world-class infrastructure, and a massive labor force, China has cemented its role as the epicenter of global supply chains. However, rising labor costs and geopolitical tensions, particularly with the U.S., have prompted some companies to explore alternatives.
The Trade War Context: A Global Shift
The U.S.-China trade war, reignited in 2025 under President Donald Trump’s administration, has imposed sweeping tariffs—up to 145% on Chinese imports—disrupting global supply chains. This has created opportunities for India to position itself as an alternative manufacturing hub, aligning with the “China+1” strategy adopted by multinationals diversifying away from China. However, China’s retaliatory measures, including curbs on exports to India, have complicated this shift, impacting sectors like electronics and EVs that rely on Chinese components.
India’s trade deficit with China, which ballooned to $85 billion in 2023-24, underscores its dependence on Chinese upstream goods like semiconductors and EV batteries. Meanwhile, China faces challenges from U.S. tariffs and accusations of dumping products in markets like India, which depresses local prices and hurts domestic manufacturers.
Comparing Strengths and Challenges
Make in India: Opportunities and Hurdles
India’s demographic dividend—a young, 500-million-strong labor force—offers a significant advantage. With labor costs averaging $1.50 per hour compared to China’s $3, India is a cost-effective destination for manufacturing and R&D. The success of companies like Apple, which shifted 14% of its global iPhone assembly to India by 2023-24, highlights this potential. Exports in mobile phones alone surged 42% to $15.6 billion in the same period.
Yet, Make in India faces structural challenges. Manufacturing’s share of GDP has stagnated at under 14% in 2025, missing the 25% target. High infrastructure costs, bureaucratic red tape, and a 33% corporate tax rate hinder competitiveness. As Akhil Ramesh, head of the India program at Pacific Forum, notes, “India risks becoming multi-dependent—on China for upstream goods, the U.S. for technology, and Russia for energy—unless it addresses domestic inefficiencies.”
Made in China: Dominance Under Pressure
China’s manufacturing ecosystem is unmatched, with advanced infrastructure, a robust supply chain, and tax incentives that attract foreign investors. Its ability to produce everything from silk yarn to EV batteries at scale has made it indispensable. However, rising labor costs and geopolitical tensions are pushing companies to explore alternatives. The China+1 strategy has led firms like Foxconn to expand in India, Vietnam, and Southeast Asia.
China’s response to trade war pressures has been resilient. The Global Times asserts, “China’s political and economic institutions are strong enough to defend its interests, with minimal concessions in trade agreements.” Yet, dependence on exports and potential overcapacity in sectors like steel and solar panels pose risks, especially as India and other markets impose anti-dumping duties.
Head-to-Head Comparison
| Aspect | Make in India | Made in China |
|---|---|---|
| Labor Costs | $1.50/hour, highly competitive | $3/hour, rising steadily |
| Infrastructure | Developing, with high costs for land, power | World-class, cost-effective |
| FDI Incentives | PLI scheme, regulatory reforms | Tax breaks, state-backed subsidies |
| Market Size | Large domestic market, growing middle class | Massive domestic and global market |
| Geopolitical Position | Multi-alignment, balancing U.S. and China | Facing U.S. tariffs, global scrutiny |
| Supply Chain Maturity | Developing, but rapidly building domestic capabilities | Highly developed, extensive supplier networks |
| Technological Focus | Diverse, with increasing focus on electronics, pharmaceuticals, EVs | High-value sectors (AI, Green Tech, Robotics) |
| Tech Dependence | Reliant on Chinese components | Leader in high-tech manufacturing |
| Production Scale | Growing, significant potential for scalability | Unmatched, high volume, established clusters |
| Government Incentives | PLI schemes, “Make in India” initiatives, SEZs | Substantial local subsidies, “Made in China” |
Case Studies: Successes and Setbacks
India’s Electronics Boom
India’s electronics sector exemplifies Make in India’s potential. The PLI scheme has attracted giants like Samsung and Foxconn, boosting mobile phone exports. Apple’s shift to India for iPhone production has created jobs and reduced reliance on China for finished goods. However, dependence on Chinese components like chips and displays remains a bottleneck, with imports from China rising to $101.73 billion in 2023-24.
China’s EV Dominance
China’s EV industry, led by companies like BYD, showcases Made in China’s prowess. With government subsidies and a mature supply chain, China produces over 60% of the world’s EV batteries. However, India’s restrictions on Chinese investments post-2020 Galwan Valley clash have limited BYD’s expansion, pushing India to seek alternative suppliers.
The Global Impact: Who Wins?
In the Make in India vs Made in China trade war, there’s no clear victor yet. India’s low labor costs, vast market, and strategic alignment with the U.S. position it as a rising star. The 90-day tariff pause announced by the U.S. in 2025 offers India a window to capture market share, particularly in shrimp exports and IT services. However, China’s entrenched infrastructure, technological edge, and global supply chain dominance make it a formidable player.
As Praveen Khandelwal, an Indian MP, notes, “The U.S.-China trade war is a significant opportunity for India’s trade and industry, but our factories aren’t ready.” India must address infrastructure gaps, skill shortages, and regulatory hurdles to compete. China, meanwhile, must navigate tariff pressures and diversify its markets to maintain its edge.
The Road Ahead: Collaboration or Competition?
Ironically, India’s success in Make in India may require closer ties with China. Chief Economic Adviser V. Anantha Nageswaran argues, “India must plug into China’s supply chains to scale up manufacturing.” Loosening restrictions on Chinese FDI in non-sensitive sectors could bridge the gap, allowing India to leverage China’s expertise while building its own capabilities.
For now, the Make in India vs Made in China trade war is less about one defeating the other and more about coexistence in a fragmented global economy. India’s rise complements China’s dominance, offering multinationals a diversified supply chain. As Naveen Jindal, head of Jindal Steel & Power, says, “China is the world’s largest steel producer, but India can carve its niche with pragmatic trade policies.”
In 2025, China still leads in terms of volume, infrastructure, and supply chain depth. However, India is fast catching up, particularly in sectors like mobile phones, textiles, and pharmaceuticals.
The winner isn’t just who manufactures more—it’s who gains global trust, strategic alliances, and resilience.
Verdict:
- China wins today.
- India is building for tomorrow.
The battle of Make in India vs Made in China is more than a trade war—it’s a competition for economic identity, technological leadership, and global influence. India is steadily carving a space for itself on the world stage. The coming years will define if the baton truly passes hands.
