India needs manufacturing to be more competitive: PM

Prime Minister Manmohan Singh Friday said India needs to expand manufacturing substantially to generate employment for the country's large and growing labour force, and help the economy become more competitive.

"Our country needs to do much more in manufacturing. We need to expand manufacturing substantially both in absolute terms and as a proportion of our Gross Domestic Product (GDP)," the prime minister said, dedicating a piping unit and a high-pressure boiler plant of public sector Bharat Heavy Electricals (BHEl) to the nation in Thirumayam in Pudukkottai district of Tamil Nadu.

A robust manufacturing sector is vital for achieving high economic growth, and the Indian government has formulated a National Manufacturing Policy with the objective of enhancing the share of manufacturing in GDP to 25 percent within a decade and creating 100 million jobs. 

It has planned National Investment and Manufacturing Zones (NIMZs), which would be the main instruments of the manufacturing policy.

The NIMZs are envisaged as integrated industrial townships with state of the art infrastructure; land use on the basis of zoning; clean and energy efficient technology; necessary social infrastructure and skill development facilities to provide a productive environment for moving from the primary to the secondary and tertiary sectors.

The prime minister said manufacturing units like that of BHEl brought in numerous benefits to a backward area like Pudukkottai.

"They bring new employment opportunities for the youth. In addition to direct jobs, they also generate indirect employment through small businesses and service providers. There is a boost to skill development as such manufacturing units induct apprentices for training.

"There is also an increase in trade and commerce in the area, contributing to an overall rise in prosperity."

The national manufacturing policy is based on the principle of industrial growth in partnership with the States. 

Referring to Tamil Nadu and Finance Minister P. Chidambaram for persuading BHEl to set up the plant at Thirumayam, he said: "Yours is a progressive State and a role model in many respects for the rest of India. I am sure that the coming time will see even more successes and greater prosperity for the people of Tamil Nadu."

The prime minister also referred to the current power deficit and the need to meet the growing demand for this. 

"We need a large-scale capacity addition programme. The government is targeting a capacity addition of more than 100,000 MW, including renewables, in the 12th Five Year Plan."

In the 11th Five-Year Plan, the country added around 55,000 MW of generation capacity which is more than twice the addition achieved in the 10th Five Year Plan. Out of this Bharat Heavy Electricals alone accounted for almost half. 

"This shows the critical role that the company plays in one of the key sectors of our economy," he said, adding that with the operationalization of the two units, the company had achieved an annual manufacturing capacity of power generating equipment worth 20,000 MW. 

Congratulating BHEl for undertaking many new initiatives to expand its manufacturing capacity, he wished the Maharatna company "many more successful ventures."