In what can be a major setback for Prime Minister Narendra Modi’s ambitious plan to woo multinational companies away from China to make in India, US President has threatened companies such as Apple with tax deterrent if they do so.
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With many companies pondering over the idea to expand their manufacturing bases in more than one country, India has stepped up to lure them in offering land and promising a fruitful future.
In what can be a major setback for Prime Minister Narendra Modi’s ambitious plan to woo multinational companies away from China to make in India, US President has threatened companies such as Apple with tax deterrent if they do so. Donald Trump said he could levy new taxes on American companies that move their manufacturing bases from China to any country other than the United States. Donald Trump has termed taxation as an incentive for companies to return the manufacturing to the United States, news agency PTI reported citing an interview. Trump has time and again asked American firms to shift their manufacturing to the United States to help create more jobs, a move that resonates with his agenda of ‘Make America Great Again’.
Donald Trump was asked his views on reports coming in about Apple shifting a significant part of its manufacturing to India and away from China to reduce logistical distrumptions. To this the President of the United States said, “If they do, you know, we gave Apple a little bit of a break because they’re competing with a company that was a part of a trade deal that we made. So it was a little bit unfair to Apple, but we’re not allowing this anymore. You know if we wanted to put up our own border like other countries do to us, Apple would build 100 per cent of their product in the United States. That’s the way it would work.”
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Global supply chains were hit with the onset of the deadly coronavirus in China as the virus spread across the whole of Wuhan and parts of Hubei province forcing Xi Jinping’s government to isolate the province and bringing the Chinese economy to a virtual standstill.
Donald Trump said instead of giving incentives to American companies to bring their manufacturing back to the country he would instead tax them for moving anywhere other than the United States. The President of the United States that they will not be doing much for the companies to get them back to the US. He instead said that the companies will have to shift back for the country. China has time and again been at the centre of Donald Trump’s speeches, where he has talked about coronavirus originating in China. Donald Trump also ridiculed the argument given by firms for setting up manufacturing bases in China, saying that the United States should have all the supply chains instead of them being spread across the world.
With many companies pondering over the idea to expand their manufacturing bases in more than one country, India has stepped up to lure them in offering land and promising a fruitful future. Prime Minister Narendra Modi in his recent address talked about making India a strong part of the global supply chain. In a bid to reach that goal, India is already making amends and has even carved a piece of land, the size of Luxembourg, according to Bloomberg. Efforts have also been made by state governments, with Uttar Pradesh Chief Minister Yogi Adityanath taking the lead and offering various perks to companies that set-up shop in the state.
Source : Financial Express0