[Answered] Discuss progress made so far in ‘Make in India’ program by India. What are various challenges to ‘Make in India’ initiative?

Demand of the question
Introduction. Contextual Introduction.
Body. Progress made so far in Make in India and challenges.
Conclusion. Way forward.

“Make in India” is a national program initiated by the Indian government to promote investment, innovation, skills development and protect intellectual property and build a top-class manufacturing ecosystem in the country. Since its inception, the government has announced several steps to improve the business environment by streamlining processes of doing business in the country.

Progress so far in Make in India initiative:

  1. ‘Make in India’ initiative led to radiant growth in the IT and manufacturing sectors. This has encouraged various global/foreign investors to make investments in India and boost their business by building the products in the country.
  2. It has made an accountable growth in the country’s GDP. The policy laid out plans to boost the manufacturing sector by raising its contribution towards GDP to 25 percent and creating 100 million new jobs by 2025.
  3. The ‘zero defect zero effect’ phrase which came with Make in India campaign has shown positive impact on the Micro, Small and Medium Enterprises (MSMEs) of India. As a result, many companies are manufacturing goods with ‘zero defects’ and ensuring that the goods have ‘zero effect’ on the environment.
  4. The implementation of Goods and Services Tax (GST) and demonetisation have made the industry as a whole much more transparent and accountable. Now the processes have been simplified such as obtaining licenses and clearances that have brought in more transparency into the system.
  5. Many companies have set up several manufacturing units throughout the country that produce electrical equipment and products such as bulbs, tube lights, wires and cables and others.
  6. The digitisation initiative that is part of Make in India has helped make processes much more transparent and easier to implement.
  7. Steps taken to improve ease of doing business include simplification and rationalisation of existing rules.  As a result of the measures taken to improve the country’s investment climate, India jumped a massive 30 places to 100th in World Bank’s ease of doing business rankings as per World Bank report.
  8. First indigenously developed and manufactured Rotavirus vaccine, ‘Rotavac’, launched. 30 bioincubators and Biotech Parks supported.

Challenges to Make in India:

  1. The biggest hindrance is the labour laws and reforms in the country. The Global Rights Index (2016), published annually by the International Trade Union Confederation (ITUC), ranked India as one of the 10 worst countries for working people. Large-scale exclusions of workers from labour law, violence and arrests are the reasons for India’s poor performance.
  2. The complex taxation system, a huge amount of paperwork and corruption may be the main cause of worries among the investors. India started out with an overly complex GST, which has dampened investor sentiment and created tremendous compliance burdens on small and medium sized enterprises (SMEs).
  3. Stringent land acquisition laws and inflexible labour regulations make it difficult for India to attract investors in the manufacturing sector.  India’s benchmark land acquisition law must be amended to make it easier to buy land for defence and development projects in the fast-growing economy, while also ensuring the rights of farmers.
  4. The biggest concern of policy makers, analysts, and investors related to the success of the ‘Make in India’ initiative is around political hold-ups.  In every session, the working of Parliament is interrupted which delays the approval of important bills.
  5. Greater availability of power is needed to realise the dream of Make in India. India is running short of power with a deficit of 5.1%. The Comptroller and Auditor General (CAG) has also recently claimed a loss of $37 billion due to lack of transparency in the allocation of the coal blocks.
  6. India lags far behind other nations in imparting skill training. Not too much has changed since then.
  7. Indian states play a very crucial role in the implementation and success of the Make in India initiative. But different political parties ruling different states differ and can never be brought on the same page. To make the concept of Make in India a success, a common consensus among the states need to be achieved.

The ‘Make in India’ programme aims to turn India into a manufacturing, design, and innovation hub in order to get big investments. This initiative is undoubtedly an inspiring initiative, which has reduced the risk factors of investing in India for many foreign companies. The availability of skilled labour, a business friendly environment, good infrastructure and low manufacturing cost are some conditions required for the success of the Make in India campaign.

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