The report ranks India third when it comes to the cost factor for manufacturing

India has emerged as the second most popular manufacturing destination in the world, just one notch below China, according to Cushman & Wakefield's Global Manufacturing Index 2021.

India and the United States have switched placed (second and third respectively), according to the index.

"India could benefit from plant relocations from China to other parts of Asia due to the already established foundations in the pharmaceutical, chemical and engineering sectors that continue to be the center of the US-China trade war," the report noted.

"However, reforms to both land and labor laws are critical to India's success as a global manufacturing location," the report added.

The Baseline Scenario of the index gives equal weightage (40 per cent each) to a country's operating conditions and cost competitiveness. Risk has been assigned a 20 per cent weightage.

The index ranks India third - behind China and Indonesia - when it comes to the cost factor as a manufacturing location.

According to Cushman & Wakefield, the Manufacturing Risk Index (MRI) assesses the most suitable locations for global manufacturing from among 47 countries in the EMEA (Europe, the Middle East and Africa), Americas and Asia Pacific.

The report has assessed these countries based on four key areas:

* Bounce Back - Projected ability to restart manufacturing operations as vaccines are rolled out

* Conditions -The business environment including the availability of talent/labor and access to markets

* Cost - Operating costs include labor, electricity and real estate

* Risks - Political, economic and environmental