China's manufacturing champions have built a formidable competitive advantage through razor-thin margins, massive investments in innovation and strong state backing, according to RPG Group Vice Chairman and FICCI President Anant Goenka.
Sharing insights from a recent five-day CEO delegation visit to China, Goenka said his team toured leading companies including BYD, Geely, Midea and Mindray to understand the drivers behind the country's industrial success.
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“I led a @ficci_india CEO delegation to China and visited companies like BYD, Geely, Midea, Mindray,” Goenka wrote in a post on X, outlining his three key takeaways from the visit.
According to Goenka, China's business environment resembles a “no-frills fighting ring” where survival depends on scale and competitiveness rather than profitability.
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“Businesses operate at margins (2-3%) global boards would never approve. Only market share matters and there is no concept of ROI. The few who survive are the toughest and the best,” he said.
A second factor behind China's manufacturing strength is its commitment to research, development and automation. Goenka noted that leading Chinese firms are investing with a decade-long horizon, prioritising innovation over short-term earnings.
“The scale of automation and R&D investment at these companies is built for a 10-year time horizon, not a quarterly one. They celebrate innovators, have walls of patents and dark factories with unmatched efficiency,” he said.
Goenka also highlighted the role of government support in shaping China's industrial ecosystem, describing the state as a “silent shareholder” across sectors.
“Cheap capital, land, power, and policy support at a scale that fundamentally changes unit economics. As long as you service interest (@ only 2-3%), debt doesn't have to be paid back. This isn't a level playing field,” he wrote.
The observations come as India seeks to strengthen its manufacturing base and integrate more deeply into global supply chains.
Earlier, Goenka argued that India should engage with China rather than distance itself from the world's second-largest economy. Presenting lessons from the delegation's visit, he said Indian companies should move beyond simply importing from China and instead position themselves as suppliers to Chinese firms expanding in India and overseas markets.
Indian businesses should also source more strategically from China and selectively explore joint ventures, he said.
“Engage with China, not avoid it. If you are not at the table, you are on the menu,” Goenka said, urging Indian industry to look beyond viewing China solely as a competitor and instead identify opportunities for collaboration and integration.
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