India may be riding the “China plus one” wave—but it’s not all clean growth. In a podcast with INDmoney, Saurabh Mukherjea, founder of Marcellus Investment Managers, warned that while India could rake in billions from industries moving out of China, some of the incoming business brings heavy environmental baggage.

“China doesn’t want to do certain things anymore,” Mukherjea said. “They’re moving up the value chain—into high-tech—and letting go of low-value, polluting sectors like industrial chemicals.” That, he noted, is a shift India is already feeling. “Southern India and parts of Gujarat are booming with chemical production. Great for GDP and stock markets, but its environmental impact is quite powerful.”

Vietnam, he added, has “benefited spectacularly” from the U.S. shifting sourcing away from China—sometimes even re-exporting lightly polished Chinese goods. “America is trying to crack down on that,” he said, “but the broader reallocation is real.”

Mukherjea described China as “the world’s factory for 40 years,” and suggested that as it lets go of sweatshop industries like textiles, countries like Bangladesh and Vietnam will naturally absorb that activity.

But for India, the real prize lies in the high-tech sectors. “Electronics, semiconductors, medical devices, and pharma—if we take even a 10% share of these from China, that’s half a trillion dollars added to our GDP in five years,” he said.

While optimistic about India’s positioning, Mukherjea’s remarks carried a nuanced message: not all growth is clean, and policymakers must reckon with the trade-offs.