BERLIN: Germany’s small and medium-sized enterprises (SMEs) are increasingly looking to expand their supply chains to India, while the US is losing popularity as a business location, the German Press Agency (dpa) reported.
Some 40 percent of German SMEs are planning to restructure their supply chains, according to the survey conducted by DZ Bank made available to the dpa.
Particularly larger companies with an annual turnover of US$54.3 million are considering expanding trade relations with India, it said. Some 15 percent of German SMEs plan to turn to India to expand their supply chains over the next five years, up from some 10 percent in 2022, according to the survey.
The result indicates that India has become “the most interesting non-European country for SMEs realigning their supply chains”, said DZ Bank, which surveyed more than 1,000 managing directors and decision-makers.
Many companies have recognised the strong growth momentum in the world’s most populous country, it said.
China is also gaining p
opularity again among SMEs, according to the representative survey conducted between 5th March and 2nd April.
“The fact that India and also South-East Asia are becoming more important is mainly due to the companies looking to diversify their supply chains amid growing political uncertainty,” DZ Bank analyst Claus Niegsch said.
The United States is losing importance after attracting German businesses for years with low energy costs and massive subsidies, SMEs are now starting to turn their back on the country, according to the survey, which found that only some 12 percent plan to focus on the US market in the future, down from 15 percent in 2022.
Some 9 percent are looking to withdraw their operations from the US entirely, the survey found.
Source: Emirates News Agency