What are the advantages to foreign companies in setting up production in India?
Answers
Answer:
In a country like the USA, the companies need to pay a good amount of salary which also includes the cost of production. However, since the rate of employment is higher in India, therefore, these companies can easily higher workers at low wages that too by cutting the safety costs. Also, in India since workers are easily replaceable, therefore a poor worker doesn’t think twice before taking up such a low paid job.
Answer:
The advantages to foreign companies in setting up production in India are the following:
They can get cheap labour in India. Wages that the companies pay to workers say in the U.S.A. are far higher than what they have to pay workers in India. For lower pay, foreign companies can get long hours of work.
They can spend the least on housing facilities for workers. Thus, companies can save costs and earn higher profits.
They can cut cost by providing lower working conditions including lower safety measures. Working conditions including lower safety measures are used as ways of cutting costs in India.
Thus the foreign companies look for setting up production in India.