In complex technology procurement, I have learnt a lesson textbook economics rarely captures: the largest buyer is not always the most powerful player. When a company depends on a single specialised supplier for a critical component, its scale becomes a liability rather than leverage. The more it buys, the more it stands to lose if that supplier falters. I call this the Monopsony Paradox.

Countries face the same risk. For over three decades, US technology firms concentrated hardware production in East Asian manufacturing hubs, particularly China. The decision delivered unmatched speed, scale and cost efficiency. But geopolitical shocks, trade disputes, export controls, pandemics and natural disasters have exposed the vulnerability of this concentration.

Building more factories in America is essential, but semiconductor plants take years to establish and require enormous investment. The US also needs a second manufacturing geography capable of handling substantial volumes and growing alongside technological advances. India is well positioned to fill that role.

What a real second source involves

Geographical diversification is not simply relocation. It means qualifying an alternative supplier capable of delivering meaningful volumes while existing production continues. Engineering teams, certified components, signed contracts and actual shipments demonstrate credibility far more effectively than contingency plans.

I witnessed this while helping a leading consumer technology company expand manufacturing from China into India. My team brought established global manufacturers to India to produce transformers, chargers and surface-mount technology (SMT) components, enabling the company's first India-made adapters. The experience reinforced a fundamental lesson:........

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