Walmart: taps India, cuts China reliance
Walmart has joined a host of multinationals that have increased their reliance on India, while reducing exposure to China. IG financial analyst @AngelineOng looks at what’s driving this move.
(Video Transcript)
Walmart joins multinational shift to Indian suppliers
Now, one other big story that we are watching for you is, of course, coming out of the retail space, and it's to do with a longer-term story that we've been watching for you about many multinationals, including in the auto sector, and also retail, having shifting their exposure to India from China.
Walmart is the latest one saying that it's boosting its import from India and cutting its reliance on China, 60% of Walmart shipments came from China in between January to August 2023, and this is versus 80% in 2018, so a significant drop there.
Western firms hedging bets against geopolitical risk
Walmart says that India is a key component of Walmart's supply chain, but this is something that is part of a bigger trend, because US and European companies have been shifting investment away from China to other markets like India.
India is also one of the main beneficiaries of this redirected foreign capital, everything from chip makers, Foxconn, we also saw some news from Apple as well, moving Tesla, moving exposure to India comes at a time when there is geopolitical risk.
And of course, many Western firms out there want to perhaps have their fingers in different pies just in case, just to hedge their bets in terms of production and their reliance on markets for their imports.
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