Indian expert: Asia's low wages no longer key advantage for supply chains

Low wages in Asian countries no longer provide a major advantage. However, waste reduction encourages companies to diversify products and adapt to market demand.

The statement was made by Priyadarshi Dash, a lecturer from India, at the CICA Think Tank Forum panel on "Green and digital transformation in supply chains," Report informs.

He noted that market-oriented policies and regulatory reforms continuously support companies in diversifying supply chains and renewing product portfolios.

The expert added that investments are rising in electronics, automotive, manufacturing, and textiles-sectors highly integrated into global value chains in Asia-reflecting rapidly changing regional and global supply trends. Multinational firms operating in Asia are diversifying production bases and reducing the impact of rising wages by expanding to other markets. Trade openness combined with favorable tax incentives, regulatory reforms, and liberalized financial markets further supports this growth.

Alongside China, countries like India, Vietnam, and the Philippines have emerged as key players by expanding raw material and resource supplies and creating new regional export markets. Asian countries' exports have steadily increased in recent years, with rising import-export activity among nations highlighting growing economic integration.

Dash also pointed out that these developments enhance suppliers' autonomy in route selection and enable technological innovation in products and services. While geopolitical factors have accelerated recent shifts in supply chains, diversification, resilience, and promotion of "green" supply chains were already progressing naturally before the pandemic.

Currently, Vietnam and Indonesia lead in ship manufacturing and trade, while India is recognized as the world"s third-largest production center in chemicals, medical equipment, generic drugs, electronics, and telecommunications. This status is attributed to India"s skilled workforce, government support, low operating costs, and favorable living conditions.