The Global Value Chain is the new trend through the corporate and economic world, across countries. In the most basic definition, it is a phenomenon that includes all the people and activities that are involved in the production of a good or service as well as its supply and distribution. This concept is the same as what would apply for an industry or company, but at a global level. Therefore strategies for global business are what becomes important to apply and India is working on those strategies that can integrate it seamlessly into this global value chain.
India has been focused on becoming a partner at all phases of the global value chain. This is not only in terms of becoming a talent hub for many organizations, but also growing into a manufacturing and logistics hub for others. Some key areas where it has integrated are as follows –
- Talent pool – India has one of the largest pools of employable talent in the world. This is a young workforce with fluent English speaking skills. That is the first element which has enabled the integration by providing the people needed for some core business operations. This talent is also linked to being technologically savvier and hence there is a huge set of people working in technology global companies, based out of Indian cities.
- Manufacturing – While India has always been a hub for some manufacturing companies, the government’s push and initiatives related to Make in India have resulted in higher involvement and more emphasis on production. India has managed to further integrate itself into the world economy on this basis.
- Design and Engineering – A lot of design and engineering centres are now a part of the Indian corporate landscape. This has ensured that India’s latent talent in the space of STEM is also used productively to contribute to the Global Value Chain.
- Startups – This is yet another way in which the role of India in the GVC has become a key one. India is thought of as a startup hub and with potential for such an ecosystem to thrive. Startups of all kinds that feed into the overall GVC are now a part of the business landscape.
GVC is a world-wide phenomenon. It works effectively when there is active participation from different economies in various stages of growth. It has a strong foundational link to roles, regulations, products and services, and processes across markets. So understanding its functioning and assimilating it is crucial for countries like India, that are ready for the next level of growth.