Ad Here  
May
June
July
August
September
October
 
 
Kudos to GIM organisers... Welcome rains for damaged roads... Well-administered State Welcome Measures. Work for 10X Change Deming awardees galore! An eventful week with VVIPs of Delhi A dual GST that will protect prosperous states Pool energy prices Focus on agriculture and human resources Oh my GOLD Research for survival... Why throw baby with bath water? Much can be done by us Strategic planning the missing link Babes In the wood-RBI North block has little clue to curb inflation Jobs - Lost, Changed or Gained BJP can now hasten its thrust for reforms Cleansing Indian retail CAD and the emergency thereof They add lustre to Padma Awards 1800 parties registered with EC – Less than 60 contest elections Sustainably developing manufacturing sector… INDIA keeps its date with destiny Low profile moves No groundnuts in groundnut oil! Healthy finances of the Chennai Corporation It’s raining funds for states. Really? Public investments and welfare will surge Wanted: decentralised financial system In the horns of a dilemma You too T M Krishna? Reform this licence to…kill TN - so much to offer... An eco-friendly commute in Mysuru Sowing seeds of hope Make way for Make in India... After all, customer is the king CSR, tech revolution and bank crisis A tale of two Bihar babus Truce at Kasturi Buildings Babes In the wood-RBI North block has little clue to curb inflation A blueprint for the future Star of the South MS Installed Technology and economic development should be linked Welcome move to widen the tax net… Two welcome measures from the chief minister... Little surplus after salaries, subsidies and debt servicing Why (not) abolish? Ganesh’s mantras The Great Fall Need plan over the long term planning PC please be our Santa A Fine division of responsibilities Miles to go... Sardar Sarovar – the seventy year itch Need for radical RBI reform Economy through the month Tax evaders’ get out of Jail-Free Card Weaving wealth of western Tamil Nadu Better relations with UK... Breaking news or breaking credibility? A gratifying record A historic indirect tax reform Trail-blazing Tamil Nadu Focus on southern TN... Indian GST – Between extremes… Policy Makers Chennai Airport-Ready for a rapid take off... When the examiner cheated... Outward ho Much ado about nothing Tryst with GST South India’s 100 most valuable companies How will it PAN OUT If not Tamil Nadu, where else? Land, land everywhere, but... Industry can’t get it from Mars, yet Skewed Economic Zones? What the big B should offer? Rail-road Rajaraman The deluge and the several kindly souls
 
Need plan over the long term planning
Last quarter, India’s economy grew at a paltry 0.1 per cent. Such low growth can be banal to the Indian economy and can disrupt investment inflows.

In this regard, the “Make in India” campaign launched by the Modi government is a significant step forward. The campaign is aimed at making India a manufacturing hub, as well as attract investments from across the world. There are several factors that could contribute in the long term development of the manufacturing sector.  


Skill development

India has a fifth of world’s youth population. It is important to use this effectively. We need to create more skilled labourers. Public private partnerships can be forged to take skill development to all the corners of our country.  Incidentally, while China’s GDP is only 5 times that of India’s, its manufacturing is 50 times that of our country. China has more than 500,000 vocational institutes compared to India’s 10,000. India need more than 500 million skilled workers by 2022 to attain the status of worldwide sourcing hubs transformation of unskilled workforce to skilled workforce is a key challenge.

 

Increase attractiveness of manufacturing industry

Visa recently announced that it wants to take 100-120 people from eight IITs offering them a whopping salary of $1,40,000 and Rs 22 lakh for domestic jobs. Other top recruiters at top Indian institutions include Google, Microsoft, Cisco, Oracle and Facebook. Very few manufacturing companies are able to offer such high packages.  Even for an average Indian student, software companies offer higher package and recruit in droves compared to manufacturing companies. These have made manufacturing industry less attractive.

 

Reforming the archaic labour laws

According to FICCI, it is India’s obsession with archaic labour policy that drove investors away, hindered employment growth and made Indian companies uncompetitive. We need less number of laws to encourage investments.  Rajasthan has tried to break these norms and provided easier laws for hiring and firing people. Similar efforts are needed from other states and centre to boost the investment climate.

 

The crucial SMEs

If India has to become the sourcing hub of the world, then the part played by SMEs will be very crucial. Recognising this, National Manufacturing Competitiveness Council is empowering the SMEs to achieve growth. Banks should be urged by government to make disbursal of loans to SMEs easier.  

 

Trade zones and smart cities

The best way to encourage investment is by forming trade zones.  SEZs played a big role in improving the services sector of India. Similarly, trade zones can help the manufacturing sector. There are 10 new smart cities which are planned under “Make in India” campaign. If trade zones are implemented in these new cities it will be greatly beneficial to the manufacturing sector.  China has a model where it has both FTZs (Free Trade Zones) and EPZs (Export Processing Zone).  It differentiates both by the rule that in EPZ certain amount of goods produced has to be exported and there is no such rule for FTZ. India could implement a similar model in the new smart cities that are being developed.

 

Healthy competition

States could be divided into different categories based on their speciality and can be pitted against each other. Best performing states in each category can be given special incentives. This will initiate competitiveness among states and can be helpful for economy as a whole.


Tax laws and concessions

India’s tax system is increasingly seen by foreign nationals as complex, lacking consistency and unpredictable. There are multitude of tax reforms like GST that needs to be implemented.  The recent tax issue of Amazon with the Karnataka government shows how it is important for us to enact new laws in tune with changing times.

Thus, properly implemented tax laws with labour reforms and better motivation to SMEs will help India in getting foreign investments as well as rekindling entrepreneurial skills in the country. This will define a long term development in the manufacturing sector of the country.

Author :
Reported On :
Sector :
Shoulder :
RELATED NEWS
ABOUT IE
IE, the business magazine from south was launched in 1968 and pioneered business journalism in south. Through the 45 years IE has been focusing on well-presented and well-researched articles. When giants in the industry stumbled to keep pace with the digital revolution, IE stayed affixed embracing technology.
Read more
 
PRIVACY POLICY
Economist Communications Ltd is committed to ensuring that your privacy is protected.
Read more
TERMS AND CONDITIONS
You agree that your use of this Website and the purchase of the magazine will be governed by these terms and conditions.
Read more
 
CONTACT US
S-15, Industrial Estate,
Guindy,
Chennai - 600 032.
PHONE: +91 44 22501236
EMAIL: indecom1968@gmail.com