There is a perception that labor in China is cheapest, but leading strategist George Zhibin Gu (in his new book: China and the new world order) is on the opinion that labor in India is by and large 50% cheaper than China — but that still China rules. And he answers the question as to why that should be. In his book he says that although India may be the world leader in outsourcing IT and software services field in manufacturing China is by far the clear winner. All this boils down to the fact that India does not have a logistics chain complete with infrastructure in place. China, on the other hand, over last 26 years, has built up a complete logistical business chain. He uses an example the logistics of consumer electronics being made in Guangdong where you have available more than 10,000 component makers. Sony alone has more than 3,000 China based component makers.
