Make
in India
campaign commenced a day after India’s manufactured satellite Mangalyaan was
successfully put in the Martian orbit, showing the world the processes,
technology, science and innovation. On the day of launch Indian prime minister
said “over the decades, the trust and confidence in government and
policymaker’s have been lost and need to be regained” this shows his commitment
towards making India a manufacturing hub.
Currently manufacturing
contributes 15% of national GDP and the aim of this campaign is to grow this to
25% by 2022. Indian government is trying to make India a manufacturing hub by
encouraging FDI, which can create employment opportunities, aiming to create
100million jobs by 2022. Its focus on Skill India, Startup India and Digital
India may boost the “Make in India” campaign; they in fact can be termed as
branches of same tree named Make in India.
How
will Make in India succeed?
There were lots of doubts in the
minds of economists and other industrial experts that whether India can compete
with China in the manufacturing sector. China is the biggest competitor of
India amongst all the other nations. But considering present situations, with
the labor costs in China increasing, bank interest rates have also increased, the
Government of China has been trying to push industries which are in the coastal
line to the inside areas. In other words China wants to get rid of its “zombie
factories”. And the manufacturing units are looking for a substitute country,
like India. This is an opportunity for India and one such example is the factory
that has been set up by FoxConn in India.
World is looking to invest in
Asia, places with high demand, and this may be a very positive opportunity for
India to attract investments.
What
is the excitement with respect to FDI?
While talking about Foreign
Direct Investments, on an average every developing country has contribution of
F.D.I at 30%of G.D.P where as in India we have F.D.I only 12%of G.D.P, it is
said that each 1% increase in F.D.I adds 0.4% of a country G.D.P growth.
There are many opportunities in
India especially with its 65% of population which is less than 35years age, and
a huge market with skilled work force. Talking about the Infrastructure,
licenses, ease of doing business, etc. we are making steady inroads in all
these aspects. Indian government is showing the whole world that India is the
best place for investment and a Red carpet for foreign investors has been laid
down. Single window clearance system has been put in place by FIPB (Foreign
Investment Promotion Board) which lead India to jump by 12 places in Ease of
doing business, from 142nd position to 130th.
Other
requirements for success of Make in India:
Land acquisition bill and GST
bill play a prominent role for India in attracting Investments from foreign
players. The basic major cost of business is towards land, labor and raw
materials. There is a need for Indian government to pass the above mentioned
bills, as also increase the number of Special Economic Zones within our
country. In India we have often
witnessed lack of cooperation and synchronization between the central and state
governments, primarily because of multiparty system. They have to be brought
together to ensure success of the Make in India campaign.
As a citizen of this country, I
really do wish this campaign succeeds and creates the benefits we expect from
it.
Manohar
Reddy
Student,
INLEAD
INBM,
Batch July 2015
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