Asia’s richest man sees growing isolation for China

Indian billionaire Gautam Adani says China “will feel increasingly isolated” and that the “leading champion of globalization” would find it difficult to recover from a period of economic weakness.

At a conference in Singapore on Tuesday, Adani said that “increasing nationalism, supply chain risk mitigation and technology constraints” as well as resistance to Beijing’s massive Belt and Road initiative would affect China’s global role.

Asia’s richest man compared “housing and credit risks” in the world’s second-largest economy to “what happened to the Japanese economy during the ‘lost decade’ of the 1990s.”

Adani’s speech comes 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 hold that position.

The founder of the eponymous group Adani controls companies ranging from ports to energy.

While pessimistic about China, Adani remains optimistic about his own country, saying India is “one of the few relatively bright spots from a political, geostrategic and market perspective.”

He predicts that India will become the world’s third largest economy by 2030, with “the largest consumer middle class the world will ever see”.

Some tech companies looking to reduce their dependence on Chinese manufacturing already see India as an attractive alternative.

On Monday, Apple announced it has started manufacturing its new iPhone 14 in India as the tech giant looks to diversify its supply chain. While the company manufactures most of its products in China, it has decided to start producing its latest devices in India much earlier than previous generations.

Companies may have to move away from China not only because of its strict Covid restrictions, which have crippled supply chains for months, but also because of growing tensions between Washington and Beijing over Taiwan.

The US government ordered two of the top US chipmakers to stop selling high-performance chips to China earlier this month. And last week, the leaders of the biggest US banks said they could get out of China if it attacked Taiwan.

Adani also mentioned the challenges facing the UK and EU countries because of the war in Ukraine and Brexit.

“While I expect all of these economies to readjust over time – and recover – the friction of the recovery feels a lot harder this time around,” he said.