\n\n<\/span>Make in India: Story of Success and Challenges<\/strong><\/span><\/span><\/h2>\nThe “Make in India” initiative was launched by Prime Minister Narendra Modi on September 25, 2014, with the aim of transforming India into a global manufacturing hub. As the program marks its 10th anniversary this year, it is crucial to assess both the achievements and challenges that have emerged over the past decade.<\/span><\/p>\nObjectives of Make in India<\/strong><\/span><\/h3>\n\n- Boost Manufacturing:<\/strong> The initiative aims to increase manufacturing sector growth to 12-14% per year, create 100 million additional jobs by 2022, and raise the sector\u2019s contribution to GDP to 25% by 2025.<\/span><\/li>\n
- Global Competitiveness:<\/strong> It seeks to enhance India’s global competitiveness by attracting foreign direct investment (FDI), modernizing infrastructure, and streamlining bureaucratic procedures.<\/span><\/li>\n
- Focus Sectors:<\/strong> Initially targeting 25 sectors, including automobiles, textiles, electronics, pharmaceuticals, defense manufacturing, and renewable energy, the program now covers 27 sectors under the \u201cMake in India 2.0\u201d phase, driving significant progress with renewed focus.<\/span><\/li>\n
- The initiative is designed to reshape India\u2019s economic trajectory and create employment opportunities for the country\u2019s vast young workforce.<\/span><\/li>\n<\/ul>\n
Main components \u00a0of \u2018Make in India\u2019<\/strong><\/span><\/h4>\n\n- New Processes<\/strong>: The initiative emphasized ‘Ease of Doing Business’ as vital for fostering entrepreneurship. It introduced streamlined procedures, simplified regulations, and minimized bureaucratic hurdles to improve the business environment for both startups and established enterprises.<\/span><\/li>\n
- New Infrastructure<\/strong>: The government focused on developing industrial corridors and smart cities, equipped with advanced technology, high-speed communication, and world-class infrastructure to support industrial growth. It also worked to strengthen intellectual property rights (IPR) infrastructure.<\/span><\/li>\n
- New Sectors<\/strong>: The program opened various sectors to Foreign Direct Investment (FDI), encouraging greater participation from global investors.<\/span><\/li>\n
- New Mindset:<\/strong> The government adopted a facilitator role rather than a regulator, forming partnerships with industry to accelerate the country’s economic development.<\/span><\/li>\n<\/ul>\n
key Initiatives taken under 10 Years of Make in India<\/strong><\/span><\/h4>\n\n- Production Linked Incentive (PLI) Scheme:
\n<\/strong>The PLI scheme was introduced to boost domestic manufacturing and reduce reliance on imports, aligning with India’s vision of becoming ‘Atmanirbhar’ (self-reliant). Its primary objectives are to attract significant investments, integrate advanced technology, and enhance operational efficiency.<\/span>
\nCovering 14 sectors, including electronics, solar panels, and pharmaceuticals, it aims to create large-scale manufacturing ecosystems. The scheme was launched with an incentive outlay of \u20b91.97 lakh crore, with \u20b91.23 lakh crore in investments realized by March 2024.<\/span><\/li>\n- PM Gati Shakti:<\/strong><\/span>
\nLaunched in October 2021, PM Gati Shakti aims to build multimodal and last-mile connectivity infrastructure, supporting India\u2019s goal of becoming a US$5 trillion economy by 2025. It is driven by seven key sectors: Railways, Roads, Ports, Waterways, Airports, Mass Transport, and Logistics Infrastructure. The government has also focused on developing industrial corridors such as the Delhi-Mumbai Industrial Corridor (DMIC) and the Bengaluru-Mumbai Economic Corridor (BMEC).<\/span><\/li>\n- Semiconductor Ecosystem Development<\/strong>:<\/span>
\nThe Semicon India Programme, with an outlay of \u20b976,000 crore, was launched to develop a sustainable semiconductor and display ecosystem. Notable projects, like Tata\u2019s joint venture with Taiwan\u2019s Powerchip in Dholera, have emerged from this initiative.<\/span><\/li>\n- National Logistics Policy:<\/strong><\/span>
\nLaunched in September 2022, this policy aims to improve logistics efficiency and cut costs, with the goal of placing India among the top 25 in the Logistics Performance Index by 2030.<\/span><\/li>\n- Boost in FDI:
\n<\/strong>Numerous reforms have been made to facilitate Foreign Direct Investment (FDI), including raising the FDI cap in crucial sectors like defense (from 26% to 74%), insurance, and railways. These reforms have led to a steady increase in FDI, with $84 billion received in 2021-22, making India a leading global FDI destination.<\/span><\/li>\n- Skill Development Initiatives<\/strong>:<\/span>
\nTo meet the growing demand for skilled labor, the government launched programs like Skill India and the Pradhan Mantri Kaushal Vikas Yojana (PMKVY), training millions of youths across the country.<\/span><\/li>\n- Startup India:
\n<\/strong>Launched to foster a thriving startup ecosystem, Startup India aims to transform India from a nation of job seekers into a nation of job creators. As of September 25, 2024, India boasts the world’s third-largest startup ecosystem, with 148,931 DPIIT-recognized startups creating over 15.5 lakh direct jobs.<\/span><\/li>\n- Tax Reforms:<\/strong><\/span>
\nThe implementation of the Goods and Services Tax (GST) on July 1, 2017, simplified the tax system, reducing production costs and enhancing the competitiveness of local manufacturing.<\/span><\/li>\n- Unified Payments Interface (UPI):
\n<\/strong>India’s UPI has become a global leader in digital payments, processing transactions worth nearly \u20b981 lakh crore between April and July 2024 alone.<\/span><\/li>\n<\/ul>\nMajor achievements<\/strong><\/span><\/h4>\n\n- Vaccines<\/strong>: India produces nearly 60% of the world’s vaccines, meaning that one in every two vaccines globally is proudly manufactured in the country. India not only achieved COVID-19 vaccination coverage in record time but also emerged as a key exporter of essential life-saving vaccines.<\/span><\/li>\n
- Rise in Mobile Manufacturing<\/strong>: India has become the second-largest mobile phone manufacturer in the world. The number of mobile manufacturing units in the country has grown from just two in 2014 to over 200 today, producing 99% of the mobile phones used domestically. Mobile exports surged from \u20b91,556 crore to \u20b91.2 lakh crore in 2024.<\/span><\/li>\n
- Defence Manufacturing<\/strong>: India has made significant advancements in defence production, particularly in decreasing imports. For instance, Hindustan Aeronautics Limited (HAL) and other domestic manufacturers are now producing vital military equipment such as fighter jets and submarines. In 2023-24, defence production reached \u20b91.27 lakh crore, with exports going to over 90 countries, demonstrating India\u2019s growing capabilities in this crucial sector.<\/span><\/li>\n
- Semiconductor and Chip Manufacturing<\/strong>: The semiconductor industry, which was previously underdeveloped, has attracted investments totaling \u20b91.5 lakh crore, with five semiconductor fabrication plants planned. These facilities are expected to have a combined daily capacity of 7 crore chips.<\/span><\/li>\n
- Railway Infrastructure<\/strong>: The Vande Bharat Trains, India\u2019s first indigenous semi-high-speed trains, exemplify the success of the \u2018Make in India\u2019 initiative. These trains feature state-of-the-art coaches, providing passengers with a modern and enhanced travel experience.<\/span><\/li>\n
- Renewable Energy Growth:<\/strong> India has become the fourth-largest producer of renewable energy in the world. The country’s capacity has surged from 76.38 gigawatts (GW) in 2014 to an impressive 203.1 GW in 2024.<\/span><\/li>\n
- Steel Production<\/strong>: India has transitioned to being a net exporter of finished steel, with production increasing by 50%. This growth is a direct result of policy efforts aimed at building domestic capacity.<\/span><\/li>\n
- Automobile Industry Growth<\/strong>: India has established itself as a global leader in automotive manufacturing, particularly in two-wheelers and electric vehicles (EVs). The EV market, valued at $3 billion, has experienced substantial growth since 2014, contributing to the country\u2019s sustainable mobility objectives.<\/span><\/li>\n<\/ul>\n
Challenges faced by Make in India program during last 10 years<\/strong><\/span><\/h4>\n\n- Slowing Growth Rate<\/strong>: According to the National Accounts Statistics (NAS), the growth rate of real gross value added (GVA) in manufacturing has decreased from 8.1% during 2001-12 to 5.5% during 2012-23.<\/span><\/li>\n
- Lagging Manufacturing Share in GDP<\/strong>: The manufacturing sector’s share of GDP has remained stagnant at 17%-18% over the past three decades, though it is slightly higher in the latest GDP figures due to methodological changes. This is still far from the target of 25%.<\/span><\/li>\n
- Limited Job Creation<\/strong>: The increase in output has not been accompanied by a corresponding rise in employment. According to the NSSO sample surveys, manufacturing employment dropped from 12.6% in 2011-12 to 11.4% in 2022-23. Meanwhile, agriculture’s share of the workforce rose from 42.5% in 2018-19 to 45.8% in 2022-23. Surveys of unincorporated sector enterprises reveal that employment in the unorganized or informal sector manufacturing still constitutes the majority of jobs, although it decreased from 38.8 million in 2015-16 to 30.6 million by 2022-23.<\/span><\/li>\n
- Exports<\/strong>: India’s exports as a percentage of GDP have declined from 25.2% in 2013-14 to 22.7% in 2022-23. Although India’s contribution to global exports has increased, it has done so at a sluggish pace. In 2005-06, India accounted for 1% of global exports, which rose to 1.6% by 2015-16. However, by 2022-23, this figure only reached 1.8%, indicating a significantly modest increase.<\/span><\/li>\n<\/ul>\n
Reason behind challanges<\/strong><\/span><\/h4>\n\n- Supply Chain and Infrastructure Bottlenecks<\/strong>: Despite advancements in industrial corridors and infrastructure projects, certain regions continue to face challenges such as inadequate logistics, poor connectivity, and inefficient supply chains.<\/span><\/li>\n
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