Economic Survey 2023-24: India, now the world's fifth largest economy in terms of nominal GDP, aims to become the third largest in the future years, and one area where it hopes to profit is the 'China Plus One' plan. Will India be able to profit from China's Plus One strategy? And how simple would it be for India to achieve 'Viksit Bharat' by 2047?

According to Finance Minister Nirmala Sitharaman's Economic Survey 2023-24, India's path to development would differ from China's - and it will not be easy!

The global background for India's march to Viksit Bharat in 2047 could hardly be more different from that of China's ascent between 1980 and 2015, according to the Economic Survey.

"Then, globalization was on the verge of protracted growth. With the conclusion of the Cold War, geopolitics remained relatively peaceful, and Western nations welcomed and even promoted China's ascent and incorporation into the global economy. Concerns about climate change and global warming were not as widespread or serious as they are now," the Survey finds.

Furthermore, the introduction of Artificial Intelligence puts a shadow of ambiguity about its influence on workers at all skill levels - low, mid, and high. "These will create challenges and hurdles to India's continued high development rates in the future years and decades. The Economic Survey states that overcoming these requires a grand alliance of union and state governments, as well as the business sector.

How Can India Benefit from China Plus One?

India has the potential to benefit from the 'China plus one' strategy because to its large domestic customer base, making it a desirable site for corporations to establish operations.

According to the Economic Survey, India has two alternatives for capitalizing on the China-plus-one strategy: integrate into China's supply chain or attract Chinese foreign direct investment. Prioritizing FDI from China looks to be a more promising path for growing India's exports to the United States, following the lead of previous East Asian nations, according to the Survey.

Furthermore, using FDI as a technique to gain from China's plus one approach appears to be more advantageous than relying on trade. This is because China is India's principal import partner, and the trade imbalance with China has grown.

As the United States and Europe move their immediate sourcing away from China, it is more efficient for Chinese businesses to invest in India and then sell items to these markets rather than importing from China, adding little value, and then re-exporting them.