Market Mix - A Big Mac Bet

THE TAKE 

As Trump Talks Tough on Trade, US Brands Are Doubling Down on India

US president Donald Trump’s favourite McDonald’s order is believed to be two Big Macs, two Filet-O-Fish sandwiches, and a large chocolate shake — malted.

On some days, he even starts his day with McDonald’s and there are reports dating back several years documenting his fondness for burgers at different times of day..

There are many photographs—most recently after he won the 2024 US elections—of him wolfing down a McDonald’s meal with friends and aides aboard his private jet.

Arguably, as President of the United States, he has done more for the McDonald’s brand than perhaps even for Tesla, despite the unusually grand White House endorsement he gave the electric car and Elon Musk.

In case you missed it, McDonald’s announced last week its formal entry into India’s global capability centre (GCC) space—its largest such investment outside the US.

GCCs are captive arms of multinational companies, handling increasingly critical operations across the value chain, from drug research and development to chip design and core business processes.

It was not a silent entry by any stretch.

A Big Mac, A Bigger Bet on India

McDonald’s Chairman and CEO Christopher Kempczinski—a former Procter & Gamble and Kraft Foods veteran—arrived in Hyderabad and met with Chief Minister Anumula Revanth Reddy. According to reports, he even explained why McDonald’s chose Hyderabad over other cities.

Kempczinski was accompanied by top McDonald’s brass and said they were also exploring ways to step up sourcing from Indian farmers for both domestic and international markets.

The company has announced it will occupy a large facility in Hyderabad, employ close to 2,000 people, and develop the centre into a skilling hub. It already has a long-standing presence of close to 600 stores across India. 

McDonald’s setting up a GCC in India is worth viewing in the context of the upcoming tariff war, expected to begin on April 2.

It does appear that while negotiations are ongoing and officials on both sides continue discussions, there seems to be a mild thaw in the tension. Trump separately has said he will be flexible last week, though he did not define that.

India is expected to concede on select tariff lines, including whiskey, superbikes, and possibly California almonds.

The ineresting thing is that despite President Trump’s repeated threats, India may be closer to a trade compromise with the US than most other countries—largely because it has already started reducing tariffs in sectors of interest to the United States.

The GCC Surge Tells a Bigger Story

To go back to McDonald’s, they are not alone.

In February, Google announced the opening of one of its largest global offices in Bengaluru, called Ananta, spread across 1.6 million square feet and meant to house 5,000 employees.

While work on the facility would have begun some time ago, that’s exactly the point—as we’ve been arguing, Corporate America’s fortunes are deeply intertwined with Indian talent, and increasingly, that talent sits right here in India.

There are now over 1,700 global capability centres (GCCs) in the country, employing more than 1.4 million people, mostly in high-skilled roles. 

An estimated 70% of those employees work for American companies. And then there is the work Indian IT majors do. Indian IT exports stood around $200 billion last year of which around 60% was to the US.

Last week, Cisco CEO Chuck Robbins told CNBC that the Trump administration wants American companies to win. “They want to protect the lead that American companies have and win the AI race,” he said.

So, if Trump wants American companies to win then it is worth pondering, again, what explains their winning so far—and what lines will they cross, and which ones won’t they?

For context, Cisco, the $54 billion tech giant, started operations in India in 1995, employs around 15,000 people, and runs one of its largest development centres outside the US here.

Just last year, it also opened its first manufacturing facility in Chennai, focused on routers, with an announced goal of creating 1,200 jobs.

Turning Tariffs Into A Competitive Advantage

Trump loves American brands—some more than others.

In the case of McDonald’s, which he proudly consumes, and Harley-Davidson, the all-American motorcycle brand that resonates with his voter base and the Made in America ethos, the affection is clear.

Maybe the tariff impact on Indian exports to the US will be harsh in some cases—but only if India doesn’t reduce its own tariffs correspondingly.

Many, including The Core, believe this is the right moment for India to cut some of its tariffs and make both the country and its industries more globally competitive, much like the liberalisation push of the 1990s.

Indian industry can rise to the challenge—if nudged in the right direction.

If Trump’s motto is Make America Great Again, then India’s motto should be: Make India Competitive Again.