Indian billionaire Gautam Adani says that China “will feel increasingly isolated” and the “foremost champion of globalization” would find it hard to bounce back from a period of economic weakness.
Speaking at a conference in Singapore on Tuesday, Adani said “increasing nationalism, supply chain risk mitigation, and technology restrictions,” as well as resistance to Beijing’s huge Belt and Road initiative, would impact China’s global role.
Asia’s richest man said that “housing and credit risks” in the world’s second largest economy were also “drawing comparisons with what happened to the Japanese economy during the ‘lost decade’ of the 1990s.”
Adani was speaking less than a month after the business mogul became the world’s third richest man, according to the Bloomberg Billionaires Index. He is the first Asian to take that spot.
The founder of the eponymous Adani Group controls companies ranging from ports to power.
While pessimistic about China, Adani remains bullish about his own country, saying that India is “one of the few relatively bright spots from a political, geostrategic, and market perspective.”
He anticipates India to become the world’s third largest economy by 2030, with “the largest consuming middle class the world will ever see.”
Some technology firms looking to reduce their dependence on Chinese manufacturing already see India as an attractive alternative.
On Monday, Apple announced that it has started making its new iPhone 14 in India, as the technology giant looks to diversify its supply chain. While the company manufactures the bulk of its products in China, it has decided to start producing its latest devices in India much earlier than with previous generations.
Businesses may have to move away from China not just because of its strict Covid restrictions, which have been hurting supply chains for months now, but also because of rising tensions between Washington and Beijing over Taiwan.
The US government ordered two of America’s top chipmakers to stop selling high-performance chips to China earlier this month. And, last week, leaders of America’s biggest banks said they could exit China if it ever attacks Taiwan.
Adani also mentioned the challenges facing the United Kingdom, and countries in the European Union, because of the war in Ukraine and Brexit.
“While I expect all these economies will readjust over time — and bounce back — the friction of the bounce-back looks far harder this time,” he said.