Call Us
+91 9231566434

Make in India:

Prime Minister Narendra Modi’s ‘Make in India’ initiative, to my mind, has been one of the most significant, structured and outcome-oriented policy initiatives by any Indian government in recent years. It was, unlike many similar initiatives in the past, well structured, properly thought through, had an identified set of priorities (originally 16 sectors, now grown to 25) and focussed on the key issue dogging all inbound foreign direct investments in India — the ease (or rather, the lack of) doing business in India.

It was also particularly well-timed. The programme itself was formally introduced on September 25, 2014, but Modi had outlined it a month earlier. In his first Independence Day speech on August 15, 2014, Modi said, “I want to tell the people of the whole world: Come, make in India. Come and manufacture in India. We have skill, talent, discipline and the desire to do something. We want to give the world an opportunity that come make in India.”

Chinese Growth

The timing was near perfect. The Chinese growth engine had started slowing. Besides, new trade-related tensions between the world’s two biggest economies — the US and China — were giving jitters to investors worldwide. They were looking for a safe hedge bet against potential turmoil in their key manufacturing base, China. And Prime Minister Narendra Modi, with a strong, pro-business image, had just burst on the scene, talking the talk that investors love to hear, and what’s more having the absolute electoral mandate to enable him to walk the talk as well, without the many pressures of ‘coalition dharma which his predecessor had to face.

The ‘Make in India’ initiative, when it took off, had ticked all the right boxes. The policy promised to clear the red tape that shrouded any potential inbound investor, create world-class infrastructure required by modern manufacturing industry, and bring in policies that helped foster a climate of innovation and, importantly, protect the intellectual property that resulted from such innovation, something that global investors had little faith in as far as China was concerned.

So, we had a plan, it was workable and it was well-timed. Investors, should, logically, have been beating a path to India to set up mega manufacturing plants to supply the world. But has the ‘Make in India’ programme achieved what it set out to do?

FDI terms

Five years down the line, the picture is a bit muddled. True, in FDI terms, India is among the world’s top destinations, garnering inflows of $49 billion in calendar 2019, according to UNCTAD. India now accounts for 85 per cent of all FDI coming into South Asia (but then our competitors in the region are Bangladesh, Nepal, Pakistan, Sri Lanka and Afghanistan!).

But FDI statistics include inflows into the capital markets, which still continue to account for the lion’s share of capital flows. Statistics on specific, manufacturing sector FDI flows are a bit harder to come by. Manufacturing FDI was around $8 billion in 2018-19, accounting for less than a quarter of the total inflows.

E-commerce, which has nothing to do with either manufacturing or ‘Make in India’, is one of the key sectors for FDI.

In some sectors in particular, ‘Make in India’ appears to be doing exceedingly well. There are over a 100 mobile phone manufacturers in India and market leader Samsung last year upped one of its largest manufacturing set-ups from China and moved it to Noida in Uttar Pradesh. Apple and Xiaomi are also invested seriously in Indian manufacturing capacity.

Work in Progress

But judged from the yardstick of what it set out to achieve, ‘Make in India’ is at best still a work in progress. The key stated outcomes were to increase the share of the manufacturing sector to 25 per cent of GDP and to create a 100 million additional jobs in the manufacturing sector by 2022.

Clearly, both have not happened, and going by the increasingly gloomy predictions for GDP growth, unlikely to happen by the target year. Manufacturing’s share of GDP, currently a shade under 15 per cent, is not likely to increase significantly over the next two years. And jobs — particularly relatively better paid, stable, manufacturing jobs — continue to be a chimera.

Why hasn’t ‘Make in India’ worked?

 To understand this, we need to understand why companies invest outside their home geographies. Looking at our companies is a good place to start. Last year, Indian companies invested nearly $12 billion as FDI in other countries, and India is now one of the top 20 origin countries for global FDI.

Why did they do it?

Essentially, there are just three or four factors which drive corporates. Into significantly increasing their risk exposure by venturing into a foreign land. The first and biggest push factor is market access. If the rules are such that you cannot fully access a coveted market without investing in it, companies will invest. That is why Tata Steel bought Corus, for instance.

The second factor is acquiring technology. Again, this was a big factor in some of the big Indian FDIs in recent years. Tata Steel wanted technology for special steels. Tata Motors bough Jaguar Land Rover for its world class technology and design capability, and so on.

The third factor is acquiring talent. In the IT space for instance, a push-pull combination of tougher visa rules and availability of high-end talent. And access-limiting restrictions, particularly for government orders. Has led to Indian IT giants like TCS, Infosys et al creating some serious capacity in the US.

The final factor is securing raw material and inputs for your domestic business. That is why Adani and Tata have bought mineral and coal mines. Abroad and why ONGC is making investments in oil and gas resources.

We need to ensure that the same factors apply in reverse as well. We have to make market access tougher via a pure trade route; So the need to ensure that Indian innovation attracts global investment (it’s already happening in the start-up space); It need to ensure that our talent does not migrate abroad but is headhunted at home; and we need to ensure that our precious natural resources are value-added at home.

Unless we tweak our policies to get these right, the ‘Make in India’. Lion cannot hope to be the king of his own jungle.

Leave a comment

Your email address will not be published. Required fields are marked *

Tag Cloud

(which was launched in March 2005 and has been used to launch over 2 000 companies including Stripe 000. personal property leases. agreements concerning the purchase 10 Ways to Generate Blog Ideas 401(k) plans 409A valuations 7 Insurtech trends to be aware of in 2021 A company that develops driverless cars Abundant Adarsh Gram Affiliate Marketing on Facebook: 4 Tips to Succeed in 2021 Affiliates Age Matter for startup Agreements or arrangements that provide benefits contingent upon a change in control. The severance or deferred compensation plans (including any salary deferral agreements AI token Airbnb Alphabet Also president and editor-in-chief of Xinhua News Agency. He urged BRICS media outlets to be aware of the general trend of global development and be “narrators” of the. BRICS story And also agreements relating to the Company’s past stock issuances. Any documents evidencing registration rights for the Company’s also securities And Bylaws. Similar information for the Company and subsidiaries And more. If your startup is an early-stage company that is looking to fund raise in 2020 Angel investment Annual recurring revenue) Antitrust Lawsuit Any determination or opinion letter and Form 5500 filings for the last 3 years. All documents or other information relating to any loans made by the Company to its employees AR/VR ecosystem Artificial intelligence Artificial Intelligence Is Changing The Insurance Landscape Attended the event as co-chairpersons of the forum. In their speeches Augmented Reality Avoid When Seeking Investment Azim Premji University Bahrain Base salary Be proactive Beijing – The fifth presidium meeting of the. BRICS Media Forum was held via video link. Monday Best Business Structure Better leader Bitcoin Blobal market Blockchain technology Branding on Investment BRICS media Building your Brand Business Business cards Business End Goal Business opportunities in Serbia Business Owners Business plans Business Software Now Buyer Personas Capitec launches ‘Scan to Pay’ feature in its app Career myths Certificates of Designation CFO Change Challenge Change is the new Normal Charitable Partnerships Chefrome Classification (including Co-working space Coinbase Commission plan (if applicable) Community-as-a-Service: A Business Model for the 21st Century Compete with Big Companies Content is the key Contracts or proposed transactions to which the Company is a party or by which it is bound which involve obligations of Copper Intensity Copyright Coronavirus Outbreak Corporate entrepreneurship Corporate Multi-nationals Corporate to Start Cost reduction Credit cards Cruise Automation Cryptocurrency Customer Experience Dealing with online hate Definition of Goal Derailing your career Deutsche Telekom Digital India Digital Marketing Digital Marketing Strategies Digitizing your business Diligence Checklist Director of The Hindu Publishing Group of India; and Dr Iqbal Survé Directors Directors or consultants. The Company’s employee handbook. If the Company has any foreign employees Disney Do We Need A New Value-System For Professional Survival In A Post-Pandemic World Don’t Make These 6 Big Mistakes When Starting a Business DoorDash Dubai Dubai opportunity for start-ups Economies Electric Vehicles Elevate Customer Experience Empathy-Based Marketing Employee Well-being Employment agreements and offer letters with severance benefits or vesting acceleration provisions. Any plans Energy Energy business Entrepreneur Entrepreneurs Entrepreneurs share their thoughts on the topic Entrepreneurship: The Adrenal Rush of Riding a Bike Epic Games Etc. Executive chairman of Independent Media of South Africa Executives Facebook Family Business Favour of casual work Fear of failure Feel lost Feeling lost Financial cash flow forecasts Find a job you love Finding a work-from-home job option First deputy editor-in-chief of Russia’s Rossiya Segodnya; Narasimhan Ram Follow the evolution trends of media also and be “leaders” in. Innovative development Follow Your Dream Confidently Game development in marketing Garib Kalyan Yojana Gas Girls in business Global cloth brands Global market Gold Government Great managers way Guide to Hiring Employees Happiness Hard Work Might Not Pay Off Harsh reality and facts of the startup ecosystem He added. Jose Juan Sanchez High Expectations to Live the Life Hire Hobby into a business How Is Automation Able To Help Insurers To Recover In The Pandemic? How Much Do I Raise for My Startup How you plan to grow your business If an employee If any. A corporate entity organizational chart If available. judgment Imperfect Progress Importance of Time Management in the Workplace Including Including employee confidentiality and proprietary information agreements. insurance policies held by the Company or of which the Company is a beneficiary and a summary of such policies Including grant dates and exercise prices. Copies of agreements relating to outstanding options Including issuance dates and original issuance price. A list of the Company’s option holders Including SnapScan and Zapper Including title Including without limitation Incubation Incubator India and South Africa India Oman Business India-Oman Instacart Instruments Investment Investment memos It’s OK to Quit (Your Job) Jobs Joy happy Kids Kind Is Not Always Good for Corporate World Leadership qualities Lean canvas Lease Legal Tech Companies Liens Life is good Like Huckabee CPA Love your job Manage people who are older than you Management Marketing Marketing automation Marketing Teams Microsoft Microsoft invests in Cruise Might Just Change My Life Millennial Mind Morality Impacts Valuation Mortgage Motivated when your business Fails Move Your Shop Online Mumpreneur NDAs Neurodiverse New Jal Shakti Ministry New Job Nice guys finish last Notice of exercise and restricted stock purchase agreement). If the Company sponsors a 401(k) plan Nurturing and Mentoring Talent Office Culture Office Décor Oil Online entrepreneur Or any affiliate thereof Or evidencing any agreements among the Company’s shareholders or between the Company and its shareholders. A summary of the vesting schedules of any stock or options subject to vesting Or outside the ordinary course of business. A list of officers and directors. If any officers are not currently devoting 100 percent of their business time to the Company Or payments to Or strike or other labor dispute. Information Regarding Employees and Employee · Benefits A list of the Company’s employees and consultants Or sublease of real property. Any documents evidencing indebtedness for money borrowed or any other liabilities incurred by the Company. Any documents evidencing any mortgages Order Pandemic Pandemic ready Patents Pension plans and insurance plans. So forms of agreements used in connection with any stock option plans. (such as a form of option agreement Person You Wanted to be as a Kid Petrocrats Please note them on this list. Information Regarding Disputes and Potential Litigation Any correspondence or documents relating to any pending or threatened action Power Powering African Countries PRASAD Scheme President of Brazil’s CMA Group; Sergey Kochetkov Private Fund Data Operations Production Promotion Proof of tax compliance Proprietary information or technology Public relationship Publishers Grow Purpose-led Qualities of a good mentor Quantum Computing Quitter Reaching Goals Recently the well known startup incubator /seed accelerator Ycombinator Recruitment Relationship and marketing Remote Work Resilience as a business leader Revenue Capture Reviving the economy and building a community with a shared future Rights Rights (including conversion or preemptive rights) or agreements for the purchase or acquisition of any of the Company’s securities Russia Safe Path Said. He Samarjit Mitra Sample businessplan Saudi Arabia Scalable and sustainable business model Scale of personality School term Select an idea SEO SEO strategy Separately list (by country) all benefits provided to foreign employees. Of course Skill India Small Business Small Business Owners Small businesses SMART CITY- A Step Into the Future Smart phone Smuggling Sony Electronics Announces New Airpeak S1 Professional Drone Sowing future growth Start-up India Start-Ups Starting Your Own Street Food Business Startup Startup Fails Startup Fundraising Startups Stay relevant and grow Stock market Stock option plans Stocks Stop Comparing Your Life with Others Stress in business Stressed At Work Structural Readjustments Required in B-Schools Structuring Investment Subrata Chattopadhay Successful Contingency planning for Business Suit or proceeding or investigation Taking money from an investor and on any terms cannot hurt Target bonus (if applicable) Tax computations The Company in excess of $25 They expressed the hope to further deepen the cooperation among. BRICS media Toxic Workplace Tracking SARS-COV-2 Variants of Concern Trade secret or other proprietary rights Trademarking Turn your sales UAE Labour Law: All You Wanted to Know About Leaves Understanding Understandings or proposed transactions between the Company and any of its officers Unified Mobile Application Union representation Unknown and Unplanned Vaccine Rollout Values back on track Various Types of Investors VC Virtual Marketing Virtual reality VR Wages Warrants Washington State Recruits Starbucks to Help With Its Covid-19 Vaccine Rollout We suggest working with an experienced startup-focused accounting firm Well before your startup is in the due diligence phase of an important fund raising or m&A transaction. What Do LPs Think of the Venture Capital Markets: What financial metrics/benchmarks do VCs look at (such as ARR What Is Working Capital What VCs Really Look For Whether the employee is exempt or non-exempt) and state of residence. The Company’s standard form of offer letter. Any agreements Whether written or oral Why Business Angels do not invest Why practising good self-care is a recipe for Success With employees or consultants). Such employee benefit plans With members also pledging joint efforts. To improve the forum mechanism also and step up post.-Covid-19 exchanges and cooperation among BRICS media. In the fight against Covid-19 Without limitation Women in business Women mean business Workers Working Capital World Embraces Phygital World leader summit World of the Red Gem Writ or decree by which the Company is bound or to which it is a party. standard forms of agreements used by the Company. joint venture and partnership agreements. management Ybersecurity in the metaverse era You should be thinking about preparing a due diligence materials which includes financial documents such as P&L statements You’re Overworked Your cap table and more. Other documents to be retained will include incorporation and constitutional documents (that evidence legal ownership

© Entrepreneursface.com. All Rights Reserved.