Last year Taiwan�s former president Lee Teng-Hui did something, which as usual, went unnoticed in India.
p____p Sharing the podium with with Gordon Chang, who wrote the book “The Coming Collapse of China”, Lee warned Taiwanese businessmen against going to China.
p____p He said that most Taiwan businesses actually LOSE, rather than make money in China, and that about 80 per cent of Taiwan companies in China never expand their plants.
p____p Lee also said that he shared Chang�s concerns with regard to the shaky nature of the Beijing regime, as well as its economic headaches, like loss-making state-owned enterprises, corruption and a crumbling banking system.
p____p Chang has predicted in his book that the present Chinese regime would collapse within a decade, as it would be unable to cope with various obligations following China�s accession to the WTO.
p____p Lee and Chang discussed China�s future in March 2002 – when China was lobbying hard to get Intel to set up a fab in the mainland.
p____p But it appears that things aren�t going as planned for China, because just last week, Intel CEO Dr Craig Barrett hinted in Australia that “It should come as no surprise that we export our manufacturing operations to areas where there is a skills surplus, such as India”.
p____p Frankly, it is a bit surprising if he wants to set up a fab in India, considering the fact that Dr Barrett himself had said that “There is, however, no thinking on setting up of any manufacturing facility in India at least at the moment”, as he rebuking ex-IT minister Pramod Mahajan for the country�s poor infrastructure, in August 2002.
p____p Whether Gordon Chang�s book has influenced Dr Barrett is not known. But it is quite well known that globally, several investors are re-considering their China fetish. A good example is Hon Hai, a Taiwanese manufacturer, which may set up manufacturing plants in India. There are also indications that the Koreans too are thinking along similar lines.
p____p Coming back to Dr Barrett, he knows only too well that India is strong in designing processors, at least ever since Vinod Dham designed the Pentium. Which is why Intel has made huge investments to set up a design center in Bangalore.
p____p So what if India�s infrastructure is weak? Surely, investment can take care of that. Also, the political leadership in India is not only easily purchasable, but also does not face problems like mass labor unrest which is becoming a major problem in China.
p____p Intel is like the IT hardware industry�s Pole Star. If Intel sneezes, the IT hardware industry catches cold. So will the Taiwanese and the Koreans take the hint and shift their manufacturing bases to India, as the dragon�s weaknesses become apparent?
p____p All I can say is �Inshaallah�!p__