A sweetener is of no use if snatched away suddenly.

"To cash in on the ongoing US-China trade war, the Narendra Modi-led government is planning to invite as many as 324 companies, including Tesla and Glaxo, to set up factories, according to a report by Bloomberg." The government will provide land along with power, water and roads to tempt companies moving out of China. Vietnam has benefited from the trade war with high growth rate of GDP based on rising exports but Vietnam is limited by its small size and population. On the other hand, India has failed to profit from the trade war because of poor infrastructure and its own trade dispute with the US. Inducements to companies in the form of Special Economic Zones (SEZs) modeled on China were set up but have failed to generate exports. "Far from turning India into a powerhouse of manufacturing exports, the control-free industrial enclaves have become centers of corruption and scams," wrote Nikita Kwatra. "Local politicians often influence bureaucrats at state-owned industrial development corporations to secure land for personal gains. As such, sites for SEZs are selected based on real estate speculation rather than economic potential of a region." Then there are rules which discriminate between manufacturing and services, restricting growth of IT firms. Perhaps, the thing that would be most scary to investors is the tendency of the government to change rules suddenly, either to collect more tax or to protect a section of Indian businesses. Thus, e-commerce rules were suddenly changed last year to protect owners of small stores, known as mom and pop retailers. This after Walmart had paid Rs 74.39 billion in taxes on its acquisition of Flipkart. Small wonder, "Walmart chief executive Doug McMillon has written to Prime Minister Narendra Modi, seeking certainty and predictability in India's business environment, people familiar with the matter said." "Walmart was particularly disappointed because the changes had come just months after it paid $16 billion to acquire Flipkart." Without exports, "India's trade deficit with China rose from $671 million in FY01 to $63 billion in FY18." Modi has continued trying to extract retrospective taxes from Cairn and Vodafone, initially demanded by the Congress-led government. Tax officials seized shares of Cairn from Vedanta Plc and sold them to meet their demand. It is still pursuing Hutchison for a tax on Vodafone. What the Center does is followed by the states. Vindictive politicians seek to break contracts reached between a previous administration and investors, including foreign ones. Trying to improve manufacturing is laudable. But will foreigners trust our word.