A month after giving a clarion call during his Independence Day speech to make India a global manufacturing hub, Prime Minister Narendra Modi on Thursday launched the ambitious “Make in India” initiative, which will focus on creating physical infrastructure as well as building a digital network to help evolve the country as a centre for manufacturing all sorts of goods.
The focus of the initiative is to increase the share of the manufacturing sector in the country’s GDP from the existing 15 per cent to more than 25 per cent. In a star-studded event, which saw the participation of who’s who of India’s corporate world as well as global honchos, Modi promised effective governance to enable ease of doing business, hinting at amending labour laws.
At the event, participated by Mukesh Ambani, Cyrus Mistry, Azim Premji, Kumar Mangalam Birla, Maruti Suzuki’s Kenichi Ayukawa and lockheed Martin’s Phil Shaw, the Prime Minister said the gloom of the past 2-3 years when industry wanted to shift abroad has gone.
He said the Government would focus on building physical infrastructure as well as creating a digital network to make India a global hub for manufacturing of goods ranging from cars to software, satellites to submarines, pharmaceuticals to ports and paper to power.
As part of the initiative, the Government has revamped an Invest India unit which will now act as the “first reference point” for guiding investors on all aspects of regulatory issues. Also, a website, www.makeinindia.com, has been created for companies to seek policy clarifications within 72 hours.
The Government has identified 25 key sectors like transportation, shipping and construction among others, in which India has the potential of becoming a world leader.
The campaign is aimed to transform the economy from the services-driven growth model to labour-intensive manufacturing-driven growth. This will help in creating jobs for over 10 million people, who join the workforce every year. Special arrangements were made to publicise the event globally in different world capitals. At the same time, programmes were held in various State capitals and Indian missions abroad.
Indirectly attacking the erstwhile UPA regime’s policy paralysis, Modi said he had felt a mood of gloom among India’s business community in the last few years due to lack of clarity on policy issues. Trust is essential for investors to feel secure and it “can be a transformative force”, he said.
Modi also referred to the Digital India mission, saying that it would ensure that Government processes remain in tune with corporate processes. While Modi himself did not announce any big-ticket measures, Commerce and Industry Minister Nirmala Sitharaman said, “With a view to providing flexibility in working hours, our Government is amending a number of labour laws.”
“We are fully committed to delicensing, deregulation and radical changes as we go along. We have an open mind,” she said.
Modi said, “Global companies want to come to Asia but they don’t know where to look in Asia. India is the only country which has democracy, the demographic dividend and demand.”
The Prime Minister said India ranks low on ease of doing business and said that his Government has sensitised officials in this regard. Stating that investment can’t just be attracted by an invitation, he said, “The most essential factor is trust. let’s start with trust and the Government will intervene only if it sees any deficiencies.”
The corporate sector, on its part, showered praise on the ‘Make in India’ initiative with Reliance Group Chairman and Managing Director Mukesh Ambani saying that in order to make it a success, it is important to be open to capital and expertise from all over the globe.
“It is important to connect village clusters with the international markets, and not only domestic markets, by building the physical infrastructure and virtual infrastructure so that all our goods and services are connected to all markets,” Ambani said.
He also lauded the initiatives taken by the Government on implementing the Goods and Services Tax, saying it will make India one market and strengthen the programme.
Vice-chairman and MD of JK Paper Harsh Pati Singhania said the endeavour is a ‘lion step’ that has the potential to change India’s economic future.
“It is heartening to see the Prime Minister talk of trust and outline both the impediments and opportunities of doing business in India. Success will however come from effective implementation in dealing with various factors required for Indian manufacturing to become globally competitive,” he said.
Tata Group chief Cyrus Mistry said, “Our aspirations on the global manufacturing arena will be fulfilled if we address certain challenges on priority. These factors will include the build-up of critical infrastructure across the country supported by stable policies, transparent and competitive tax and duty structure, efficient and time-bound administration through the use of e-governance, cost effective and reliable energy coupled with logistics, critical for the competitiveness of industry.”
Exuding confidence on India’s competitiveness, Aditya Birla Group Chairman Kumar Mangalam Birla said, “India has come to be known as global IT hub and reservoir of intellectual capital. It’s high time that India becomes a preferred centre of choice for manufacturing for global companies.”
Stating that India is not the easiest country to do business in, Kenichi Ayukawa, Managing Director and CEO of Maruti Suzuki India ltd, said, “We are fully confident that, under the Make in India programme of the Prime Minister, factors that adversely affect the competitiveness of manufacturing will now be removed quickly.”