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(GIST OF KURUKSHETRA) Progressing Nation through Make in India

[February-2022]

Progressing Nation through Make in India

Context:

In its effort to make India a manufacturing hub, the government is developing industrial corridors and smart cities to provide infrastructure based on state-of-the-art technology with modern high-speed communication and integrated logistic arrangements.
Innovation and research activities are being supported through fast paced registration systems and accordingly, the Intellectual Property Rights registration set-up has been upgraded. A number of new initiatives have been launched in order to streamline and rationalise licensing rules at the States level, aligning them with global best practices.
Since the launch of this landmark programme, the government has taken several reform initiatives to create an enabling environment for providing an impetus to manufacturing, design, innovation and startups. India has emerged as the fastest growing economy globally.

Make in India has already created a strong impact in form of improved business environment and economic growth. Some of the recent highlights include:

India is now 4th amongst the world’s most attractive investment destinations.
According to UN, India is forecast to grow at 10.1 percent in 2022, becoming the fastest growing major economy in the world.
India remains an attractive destination for FDI on account of healthy prospects of economic growth and its skilled workforce.
India ranks among the top 50 nations in the latest 2021 edition of the Global Innovation Index (GII).
India has held onto its position as the world’s 7th most valuable nation brand.
India maintained 43rd rank on an annual World Competitiveness Index compiled by the Institute for Management Development (IMD) that examined the impact of COVID-19 on economies around the world this year.

Major Sectoral Success Stories of Make in India

Defence

Under the Aatma Nirbhar Bharat campaign, the defence sector has been identified as one of the core areas to boost ‘Make in India’.
The government has taken several initiatives like de-licensing, de-regulation, export promotion,and foreign investment liberalisation, to give the defence manufacturing sector a boost.

Some of the recent highlights include:

The production plan of over 500,000 AK-203 assault rifles goes on stream.
108 military weapons and systems including next-generation corvettes, airborne early warning systems, tank engines and radars are to be made in India.
South Korean major Hyundai Heavy Industries (HHI) and public sector Hindustan Shipyard
Limited, Visakhapatnam, joining hands to build warships. Another Korean firm, Samsung, will
be collaborating with Kochi Shipyard to make liquefied natural gas (LNG) tankers.
The INS Visakhapatnam, one of the four stealth guided-missile destroyer ships under Project
15B, has been indigenously manufactured by the Mazagon Dock Shipbuilders.
Moving ahead on its Rs 6,000-crore ‘Make in India’ project for military helicopters, Russia has informed the Ministry of Defence about a partnership with Reliance Defence to manufacture Kamov 226T choppers locally.
Bullish on India as a market place as well as a manufacturing hub, leading aircraft maker Airbus said it has begun sourcing components for almost all its jets from the country and aims to take its cumulative sourcing from there to USD 2 billion in the next five years.
Global aviation major Pratt and Whitney, has committed to set up its R&D facilities in Haryana.
French drone manufacturer LH Aviation has announced a manufacturing plant in India to produce drones.
Boeing announced setting up a factory to assemble fighter planes, either the Apache or Chinook defence helicopter in India, as well as the manufacture of the F/A-18 Super Hornet.

Manufacturing Sector

With the help of Make in India drive, India is on a path of becoming the hub for hi-tech manufacturing as global giants such as GE, Siemens, HTC, Toshiba, and Boeing have either set up or are in process of setting up manufacturing plants in India, attracted by India’s market of more than a billion consumers and an increasing purchasing power.
As per the World Bank, manufacturing contributed about 16 percent to the country’s GDP in 2016. This is on the higher side when compared with the global average of about 15 percent in 2015.

Automobiles

Global car majors have been ramping up investments in India to cater to growing domestic demand. These manufacturers plan to leverage India’s competitive advantage to set up export oriented production hubs. Private players such as Hyundai, Suzuki, and General Motors are keen to set up an R&D base in India.
The Indian automotive industry is the fifth largest in the world and is slated to be the third largest by 2030. To boost Electric Vehicles in India, the FAME India Scheme II is proposed to be implemented over a period of 3 years with a financial outlay of Rs. 10,000 Crore, for faster adoption of electric mobility and growth of electric and hybrid technology to improve the eco-system in the country.

Retail

Indian retail industry has emerged as one of the most dynamic and fast-paced industries due to the entry of several new players. It accounts for over 10 percent of the country’s gross domestic product (GDP) and around eight percent of the employment. India is the world’s fifth-largest global destination in the retail space.
India ranked 73 in the United Nations Conference on Trade and Development’s Business-to-Consumer (B2C) E-commerce Index 2019. India is the world’s fifth largest global destination in the retail space and ranked 63 in World Bank’s Doing Business 2020.
In FDI Confidence Index, India ranked 16 (after US, Canada, Germany, United Kingdom, China, Japan, France, Australia, Switzerland, and Italy).

Renewables

India aims to achieve 40 percent of installed power generation capacity from non-fossil fuel sources and reduce emission intensity of GDP by 33-35 percent by 2030 from 2005 level.
With the accomplishment of these ambitious targets, India will become one of the largest Green Energy producers in the world, surpassing several developed countries. Solar Power tariff is reduced by more than 75 percent using plug and play model.
India submitted its Intended Nationally Determined Contribution (INDC) to the UNFCCC, on its goal of installing 175 gigawatts (GW) of renewable power capacity by 2022 by setting a new target to increase the country’s share of non-fossil-based installed electric capacity to 40 percent by 2030.

Pharmaceuticals

India is the largest provider of generic drugs globally. Indian pharmaceutical sector supplies over 50 percent of global demand for various vaccines, 40 percent of generic demand in the US and 25 percent of all medicine in the UK. Globally, India ranks 3rd in terms of pharmaceutical production by volume and 14th by value.
The domestic pharmaceutical industry includes a network of 3,000 drug companies and ~10,500 manufacturing units.
According to the Indian Economic Survey 2021, the domestic market is expected to grow 3X in the next decade. India’s domestic pharmaceutical market is estimated at USD 42 billion in 2021 and likely to reach USD 65 billion by 2024 and further expand to reach ~USD 120-130 billion by 2030.
India’s biotechnology industry comprises biopharmaceuticals, bio-services, bio agriculture, bio-industry, and bioinformatics.

Way forward:

As India is near its 75th anniversary of independence from imperial rule, the ‘make in India’ project assumes the role of a philosophy – of creating an Aatmanirbhar Bharat or a self-reliant India.
It is a vision of making India a self-reliant nation and does not aim to be protectionist in nature or to cut off the country from rest of the world.
It is a vision for India to play a larger role as part of the world economy, a mission towards drastic reduction on import reliance by focusing on replacement via domestic manufacturing.
Today, India has come a long way since its independence in 1947 to achieve the goal of a self-dependent and self-reliant nation.
The vision of Atmanirbhar Bharat comes from the realisation that we first need to focus on innovation, capability building, and skilling.
Atma Nirbharta seeks to enhance existing capabilities through focus, instead of playing in areas where the global competition is intense.
The aim is to invest in local companies that will be the competitors of global companies, for domestic as well as export purposes.