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India Fed Up As Well

Apparently, there is some dissention among the countries we tend to think of, sometimes stereotypically, as low cost manufacturers.

In an article that recently ran on the website of India’s Business Standard (one of the largest daily newspapers in the country), columnist Dilip Kumar Jha complained that China is “too cheap.” 

Does this finally lend credence to the many years of complaints from North American metalcasters saying the exact same thing?

Let’s be honest. When a casting is made, several fixed costs don’t change no matter where in the world the part is made: metal prices, energy costs, shipping. The biggest variable is human costs. When you compare the cost of labor between China and North America, the difference is obvious. But comparing India to China? Add the cost of shipping, and you should have a wash. Apparently not, according to Jha.

Even with the lower labor costs, something is missing. What if we un-pegged the Yuan from the dollar? Then, China’s ongoing program of deflating its currency to ensure its exports remain competitive might make the economic water level rise—globally. That would be interesting.