SYNOPSIS

What is Make in India ?

Make in India is a major national programme of the Government of India designed to facilitate investment,
foster innovation, enhance skill development, protect intellectual property and build best in class manufacturing
infrastructure in the country. The primary objective of this initiative is to attract investments from across the
globe and strengthen India’s manufacturing sector. It is being led by the Department for Promotion of Industry
and Internal Trade (DPIIT), Ministry of Commerce and Industry, Government of India. The Make in India
programme is very important for the economic growth of India as it aims at utilising the existing Indian talent
base, creating additional employment opportunities and empowering secondary and tertiary sector. The
programme also aims at improving India’s rank on the Ease of Doing Business index by eliminating the
unnecessary laws and regulations, making bureaucratic processes easier, making the government more
transparent, responsive and accountable.
“I want to tell the people of the whole world: Come, make in India. Come and manufacture in India. Go and
sell in any country of the world, but manufacture here. We have skill, talent, discipline and the desire to do
something. We want to give the world an opportunity that come make in India,” Prime Minister of India, Mr
Narendra Modi said while introducing the programme in his maiden Independence Day speech from the
ramparts of the Red Fort on August 15, 2014. The initiative was formally introduced on September 25, 2014 by
Mr Modi at Vigyan Bhawan, New Delhi, in the presence of business giants from India.
The focus of Make in India programme is on 25 sectors. These include: automobiles, automobile
components, aviation, biotechnology, chemicals, construction, defence manufacturing electrical machinery,
electronic systems, food processing, IT & BPM, leather, media and entertainment, mining, oil and gas,
pharmaceuticals, ports and shipping, railways, renewable energy, roads and highways, space, textile and
garments, thermal power, tourism and hospitality and wellness.
The dedicated website for this initiative (www.makeinindia.com) not only showcases the 25 sectors but also
puts focus on opportunities, policies and Ease of Doing Business. The Investor Desk is an integral part of this
website, which aims at providing all information/data analysis to investors across sectors.

Make in India campaign

Make in India is the BJP-led NDA government's flagship campaign intended to boost the domestic
manufacturing industry and attract foreign investors to invest into the Indian economy. The Indian Prime
Minister, Mr. Narendra Modi first mentioned the keyphrase in his maiden Independence Day address from the
ramparts of the Red Fort and over a month later launched the campaign in September 2014 with an intention
of reviving manufacturing businesses and emphasizing key sectors in India amidst growing concerns that most
entrepreneurs are moving out of the country due to its low rank in ease of doing business ratings.

The Make in India Vision

Manufacturing currently contributes just over 15% to the national GDP. The aim of this campaign is to
grow this to a 25% contribution as seen with other developing nations of Asia. In the process, the government
expects to generate jobs, attract much foreign direct investment, and transform India into a manufacturing hub
preferred around the globe. The logo for the Make In India campaign is a an elegant lion, inspired by the
Ashoka Chakra and designed to represent India's success in all spheres.The campaign was dedicated by the
Prime Minister to the eminent patriot, philosopher and political personality, Pandit Deen Dayal Upadhyaya who
had been born on the same date in 1916.

Why PM wants to Make in India?

The Prime Minister called for all those associated with the campaign, especially the entrepreneurs and the
corporates, to step and discharge their duties as Indian nationals by First Developing India and for investors to
endow the country with foreign direct investments. The Prime Minister also promised that his administration
would aid the investors by making India a pleasant experience and that his government considered overall
development of the nation an article of faith rather than a political agenda. He also laid a robust foundation for
his vision of a technology-savvy Digital India as complementary to Make In India. He stressed on the
employment generation and poverty alleviation that would inevitably accompany the success of this campaign.

What are the sectors covered under this initiative?

Make in India strives to create jobs and skill enhancement in the following 25 sectors:

1. Automobiles
2. Aviation
3. Chemicals
4. IT and BPM
5. Pharmaceuticals
6. Construction
7. Defence manufacturing
8. Electrical machinery
9. Electronic system
10. Food processing
11. Textiles and garments
12. Ports and shipping
13. Leather
14. Media and entertainment
15. Wellness and healthcare
16. Mining
17. Oil and gas
18. Tourism and hospitality
19. Railways
20. Automobile components
21. Roads and highways
22. Space
23. Thermal power
24. Bio-technology
SOME SECTOR WISE DEVELOPMENTS
In a major boost to the 'Make in India' initiative, the Government has received confirmation from top technology
firms such as GE, Bosch, Tejas and Panasonic regarding their decision to invest in the electronic, medical,
automotive and telecom manufacturing clusters in India. "We have received 57 investment proposals of over
Rs 19,000 crore (US$ 3.05 billion) of which 30 proposals worth Rs 6,500 crore (US$ 1.04 billion) have been
approved," said Ravi Shankar Prasad, Union Minister of Communications and Information Technology,
Government of India.

1. Automobile Sector

Being the 7th largest producer of vehicles, 2nd largest two-wheeler manufacturer, and fifth largest commercial
vehicle manufacturer in world, Indian auto industry contributes approximately 7.1 per cent of the GDP and is
expected to rise to impressive 3rd position by 20168 . India is also a prominent auto exporter and has strong
export growth expectations for the near future.

2. Aviation

Aviation market of India is one of the fastest growing markets. At present India is the ninth largest Aviation
market of the world where its market size is about US $ 16 billion18. India has set the target of becoming 3rd
largest aviation market by 2020 and then to be the largest aviation market of the world by 203019. For majority
of the Indian population air transport is still a luxurious but expensive mode of travelling.

3. Defence

India has the third largest armed force in the world. 60% of the defence equipments is imported. In order to
foreshorten the import, foreign exchange and security issues concerned there is tremendous requirement to
manufacture these equipments in India. Through defence procurement policy, in make in India initiative, the
manufacturing share is to be increased from 15% of Gross Domestic Product (GDP) to 25 % along with
generating employment opportunities of ten million per annum. Here is a brief detail about the companies
which have either invested or are going to invest in the defence sector.

4. Tourism and Hospitality

One of the fastest and biggest growing sector in the economy is the Tourism sector in the global economy
having several positive and negative effects like cultural, economic, social and environmental etc. It contributes
remarkably to the GDP of a country through the growth of transport, hotels, shopping, restaurants and
entertainment etc. In India tourism and hospitality contributed nearly US$ 187.9 billion or 12.5 per cent to the
GDP in 2014-1531. Due to a rich historical culture and heritage, Indian tourism has huge potential to attract
tourists from around the globe. Additionally, this sector is also helpful in earning foreign exchange and creating
numerous employment opportunities.

What are the outcomes of this initiative since its launch?

 For the sectors like Railways, Defence, Insurance and Medical Devices have opened up for higher levels of FDI.
 Investor Facilitation Cell (IFC) was created in 2014 to assist investors while seeking regulatory approvals,
assistance during the pre-investment phase, execution and after-care support.
 Its website provides details about live projects such as industrial corridors and gives information on policies in areas
of FDI, intellectual property rights and other related initiatives by the Indian government.
 Under the Make in India initiative, the following industrial corridors are proposed to be created:
 1. Delhi-Mumbai Industrial Corridor
2. Chennai-Bengaluru Industrial Corridor (first defence industrial corridor is proposed to be developed along
this corridor)
3. Visakhapatnam-Chennai Industrial Corridor
4. Bengaluru-Mumbai Economic Corridor
5. Amritsar-Kolkata Industrial Corridor

 Steps are being taken to improve the ease of doing business such as Shram Suvidha Portal, eBiz portal (single
window access to 11 central government services related to starting a business), etc.
 Since its launch, the FDI inflow has increased significantly. According to DIPP, it stood as $60 billion and $62 billion
in 2016-17 and 2017-18 respectively.
 However, the FDIs in the manufacturing sector is weakening. It came down to $7 billion in 2017-18 as compared to
$9.6 billion in 2014-15.
 FDI in the service sector, on the other hand, is $23.5 billion – more than three times higher than the manufacturing
sector.
 This shows India’s traditional strong points are thriving.
 India’s share on global exports of manufactured products remains around 2%, which is less than China’s 18%
share.

What are the challenges?

 Investment from shell companies: The major part of the FDI inflow is neither from foreign nor direct. Rather, it
comes from Mauritius-based shell companies that are suspected to be investing black money from India.
 Productivity: India’s manufacturing sector’s productivity is low and the skills of the labour force are insufficient.
According to McKinsey’s report, the Indian workers in the manufacturing sector are, on average, almost four to five
times less productive than their counterparts in Thailand and China.
 Small industries: The size of the industrial units is small. Therefore, it cannot attain the desired economies of
scale. It also cannot invest in modern equipment and develop supply chains.
 Complicated labour laws: One of the major reasons behind the small companies is due to the complicated labour
regulations for units with more than 100 employees. The government’s approval is required under the Industrial
Disputes Act of 1947 before the industry can lay off the employees. Additionally, the Contract Labour Act, 1970
requires the government’s and the employee’s approval for simple changes in an employee’s description or duties.
 Electricity: The cost of electricity is almost the same in India and China. However, the outages are far higher in
India.
 Transportation: The average speed in China is about 100 km/hour. In India, it is about 60 km/hour. Also, the Indian
railways are overloaded and the Indian ports have outperformed by a lot of Asian nations.
 Bureaucracy: India’s bureaucratic procedures and corruption within the government makes India far less attractive
for investors.
 Though India has made progress in the World Bank’s Ease of Doing Business Index (EDB index), it is only ranked
77 among th190 nations.
 Although EDB rank has improved, the Make in India initiative has not succeeded in increasing the size of the
manufacturing sector relative to the domestic output.
 India ranks 78 out of 180 countries in Transparency International’s Corruption Perception Index.
 Land acquisition to build a plant is very difficult. India has come down to 10 places in the World Economic Forum’s
latest annual Global Competitiveness Index.
 Prior steps were not taken to improve India’s labour laws and land acquisition laws before attracting foreign
investments in India through the Make in India initiative.
 Capital Outflow is a major challenge for Make in India’s initiative. The net outflow of capital has increased as
the rupee value has dropped from 54 a dollar in 2013 to more than 70 a dollar in 2019. The economic
slowdown and oil prices are also contributing to this major challenge.

What is the government doing about it?

 The FDI norms have been revised to make India more attractive for the investors. This is necessary to enhance the
competition with Southeast Asian nations and export growth.
 Export-oriented growth is being prioritized.
 The corporate tax has been reduced to increase foreign investment.
 The US-China dispute has given India a renewed opportunity to attract the foreign investments that are fleeing from
protectionist measures by these nations.
 India is taking steps to enhance diplomatic ties with the nations that are likely to enhance investments in India.
 However, this too is proving to be a difficult feat for India due to the current challenges. According to the Japanese
financial firm Noura’s report, only 3 of the 56 companies that have decided to relocate from China have moved to
India.

SOME OTHER CHALLENGES

The concept of Make in India is undoubtedly an inspiring initiative of the Indian government which has reduced
the risk factors for investing in India for many big foreign industries, but the pace of the progress is slower as
decided and predicted.

1. Political Stalemate

Political stalemate or gridlock is of major concern among the policymakers, analysts and investors. Session by
session the working of the parliamentary affairs is interrupted and delaying the approval of important bills in the
parliament houses owing to political gridlock. As a result, the economy and the mindsets of the investors are
confused. Important bills and reforms such as land acquisition and labor and Goods and Services Tax (GST)
are some examples.

2. Role of Indian States

The role of the Indian states is very crucial in the implementations and success of the Make in India initiative.
India with a federal political system like the United States has a large and versatile geographical and
demographical distribution. The involvement and cooperation of state-level decision-makers, political leaders
and authorities in a positive way is the basic requirement for the grand success of the new initiative. But it
seems to be a dream as many of the now-NDA governed states are hesitating in its implementations.

3. Basic And Better Infrastructure

No business can succeed without the availability of high quality and modern infrastructure. Industrial zone
equipped with basic needs of modern and high-speed communication technologies, integrated logistic
arrangements, regular power supplies, connectivity to transporting areas, ease of availability of raw materials
etc. No infrastructure is possible without the availability of land. This requires a new, transparent, effective and
equitable land acquisition law. However, the approval of such laws is interrupted due to political gridlock.

4. Power Supply

There are many villages in many of the Indian states where still there is either the limited power supply or no
power supply. Thus providing the basic need of the industry i.e. power supply is the major issues to be dealt
with.

5. Skilled Manpower

Another hurdle in the path of Make in India is the shortage of skilled manpower. A nation requires skilled
human resources in order to prosper and move atop in the global scenario. Indian comes second after China
as far as its population statistics are concerned. In spite of this, India is still in the list of developing countries.
No doubt the power of the India is its youth, but this power is not utilized in a fruitful manner. The youth is not
skilled in a right way and the major reason for this is our education system. In spite of mushrooming of
educational institutions in the last two decades, skilled manpower is limited. The curriculum is not updated
according to the needs and demands. Even no skilled trainers, teachers and instructors are employed in these
educational institutions. The students are educated theoretically rather than practically.
6. Taxation

India is ranked 142nd in the list of 189 countries when it is assessed for ease of doing business. The complex
taxation system, a huge amount of paperwork and corruption may be the main cause of worries among the
investors. Although, various steps have been taken to provide a conducive environment and platform for doing
business through Make in India initiative though still beyond realities.

What can be the way forward?

 It is evident that India is not gaining the full potential of the Make in India initiative.
 Government measures are currently seeing very limited results out of the steps taken by it to deal with the
current challenges faced by the Indian economy.
 The core issues that are plaguing the Indian economy need to be resolved before intending to make India a
global manufacturing hub.
 For instance, India is facing an unemployment crisis.
 To solve this, the government can take steps to make full use of the potential of India’s young labour force.
 This can be done by enhancing their skills, training, education and providing them with better health care. It
doing so, the productivity of the labour force can be achieved.
 Labour laws and land acquisition must be reformed so that there is an increase in the inflow of the investments
and establishment of manufacturing industries.
 Prioritizing the MSME sectors can greatly enhance India’s GDP from the manufacturing sector.
 Bureaucratic procedures must be simplified in a way that ensures transparency and accountability.
 Assisting smaller industries to set up a supply chain within India.
 Prioritizing the shift to renewable energy sources for electricity can boost the manufacturing industry’s
productivity.
 Assisting startups through financial support, training, etc. can boost India’s manufacturing sector.
 Innovation must be encouraged and research and development must be supported by the government.
 Improving connectivity even in the isolated and difficult terrains in India is possible only if the government takes
the step to achieve it. It can not only improve India’s manufacturing sector but also solve the problem
of insurgency and other illegal activities in the nation.
 In short, the government must ensure that there is a favourable environment for the growth of industries within
the Indian economy.

CONCLUSION
To conclude, the concept of Make in India is a very promising and innovative initiative started by Indian
government. The direct and indirect outputs of the Make in India concept include more job opportunities
reducing unemployment, high purchasing power to better-living styles, better state of the art of infrastructure,
smart cities etc. The role of the government is to be a facilitator rather than a regulator. Through this campaign,
selected domestic companies with leadership in innovations and new technologies are also evaluated for
boosting trade and economic growth and for turning them into global champions. The campaign is still in its
initial stages so it will be very early to predict its success.
 Questionnaire(Draft)
 Do you live in India or have strong knowledge about Make in India?
o Yes
o No

 How far import and export incentive taken by make in India can attract foreign
investment?
o 0% to 20%
o 20% to 40%
o 40% to 60%
o 60% to 80%
o 80% to 100%
 How far the make in India incentive can increase employment in India?
o 0% to 20%
o 20% to 40%
o 40% to 60%
o 60% to 80%
o 80% to 100%
 Are you benefited from Make in India initiative?
o Yes
o No

 How far make in India incentive manufacturing development industry?

o 0% to 20%
o 20% to 40%
o 40% to 60%
o 60% to 80%
o 80% to 100%

 How far the FDI inflow can contribute in infrastructure sector under make in India
program?
o 0% to 20%
o 20% to 40%
o 40% to 60%
o 60% to 80%
o 80% to 100%