Make in India

Last updated

Make in India
Make In India.png
Country India
Prime Minister(s) Narendra Modi
Key people Ministry of Commerce and Industry (India)
LaunchedSeptember 25, 2014;10 years ago (2014-09-25)
StatusActive
Website makeinindia.com

Make in India is an initiative by the Government of India to create and encourage companies to develop, manufacture and assemble products in India and incentivize dedicated investments into manufacturing. [1] The policy approach was to create a conducive environment for investments, develop a modern and efficient infrastructure, and open up new sectors for foreign capital. [2] [3] [4]

Contents

Make in India has been unsuccessful at achieving its stated targets. Under this programme, the share of manufacturing in GDP was projected to reach 25% by 2022. However, the GDP share of manufacturing has actually fallen from 16.7% in 2013-2014 to 15.9% in 2023-2024. [5] [6] [7] [8]

History

Announced in 2014, "Make in India" had three stated objectives:

  1. to increase the manufacturing sector's growth rate to 12-14% per annum;
  2. to create 100 million additional manufacturing jobs in the economy by 2022;
  3. to ensure that the manufacturing sector's contribution to GDP is increased to 25% by 2022 (later revised to 2025). [9]

After the launch, India gave investment commitments worth ₹16.40 lakh crore (US$200 billion) and investment inquiries worth of ₹1.5 lakh crore (US$18 billion) between September 2014 to February 2016. [10] [11] [12] As a result, India emerged as the top destination globally in 2015 for foreign direct investment (FDI), surpassing the United States and China, with US$60.1 billion FDI. [13] As per the current policy, 100% Foreign Direct Investment (FDI) is permitted in all 100 sectors, except for Space industry (74%), defence industry (49%) and Media of India (26%). [14] [15] Japan and India had also announced a US$12 billion 'Japan-India Make-in-India Special Finance Facility" fund to push investment. [16]

In line with the Make in India, individual states too launched their own local initiatives, such as "Make in Odisha", "Tamil Nadu Global Investors Meet", "Vibrant Gujarat", "Happening Haryana", and "Magnetic Maharashtra". [17] India received US$60 billion FDI in FY 2016–17. [18]

The World Bank's 2019 ease of doing business index acknowledges India's jump of 23 positions against its rank of 100 in 2017 to be placed now at 63rd rank among 190 countries. [19] By the end of 2017, India had risen 42 places on the ease of doing business index, 32 places in the World Economic Forum's Global Competitiveness Index, and 19 notches in the Logistics Performance Index. [18] The growth rate of manufacturing averaged 6.9% per annum between 2014–15 and 2019–20. [20] The share of manufacturing dropped from 16.3% of GDP in 2014–15 to 14.3% in 2020–21, [20] and dropped further to 14.1% in 2023–24. [21]

Three capital acquisition proposals worth ₹4,276 crore were cleared for the government's Make-In-India scheme on January 10, 2023. Due to a lack of awareness of transparent legal protection and law enforcement, hesitated investors and slow progress are the main difficulties in building a business-friendly environment. [22] With some big companies finally tried to fulfill "make in India" decades after, [23] however, it did not achieve enough jobs as expected. [24] [25]

The "Make In India" initiative

Ease of doing business

In 2019, India was ranked at 63rd place out of 190 countries in the World Bank's ease of doing business index, [26] up from 130th in 2016. [27] In February 2017, the government appointed the United Nations Development Programme (UNDP) and the National Productivity Council "to sensitise actual users and get their feedback on various reform measures." [28] As a result, now there is competition among the states of India to improve their current ranking on the ease of doing business index based on the completion percentage scores on 98-point action plan for business reform under Make in India initiative. [29] [30] [31] [32] [33] [34] Currently Andhra Pradesh, Uttar Pradesh, Telangana, Madhya Pradesh, Jammu and Kashmir and Chhattisgarh are top six states (c. Oct 2020). [35]

Ongoing global campaign

The campaign was designed by Wieden+Kennedy, [36] with the launch of a web portal and release of brochures on the 25 sectors, after foreign equity caps, norms and procedures in various sectors were relaxed, including application of manufacturing application made available online and the validity of licenses was increased to three years. [37]

"Zero Defect Zero Effect" slogan was coined by Prime Minister of India, Narendra Modi, to guide the Make in India initiative that produces products with no defects with no adverse environmental and ecological effects. [38] [39]

"Make in India Week" multi-sectoral industrial event at the MMRDA from 13 February 2016 was attended by 2500+ international and 8000+ domestic, foreign government delegations from 68 countries and business teams from 72 countries and all Indian states also held expos. Event received over ₹15.2 lakh crore (US$180 billion) worth of investment commitments and investment inquiries worth ₹1.5 lakh crore (US$18 billion), where Maharashtra led with ₹8 lakh crore (US$96 billion) of investments. [10] [11] Previously between September 2014 and November 2015, the government received ₹1.20 lakh crore (US$14 billion) worth of proposals from companies interested in manufacturing electronics in India. [12]

Revision in Public Procurement Order & GFR

On June 15, 2017, Ministry of Commerce and Industry (India), the nodal ministry revised the Indian public procurement order and general financial rule to incorporate preference to Make In India. Subsequently, all the nodal agencies published their own orders to extended the scope of Make In India in procurement related to their line of products. [40] [41]

Sectors covered

Make in India focuses on the following 25 sectors of the economy:

Automobiles

General Motors announced an investment of US$1 billion to manufacture automobiles in Maharashtra. [42]

In April 2017, Kia announced that the company would invest over $1.1 billion to build a car manufacturing plant in Anantapur, Andhra Pradesh. The facility is the company's first manufacturing plant in India. Kia stated that it would hire 3,000 employees for the plant, and it would produce 300,000 cars annually. Construction of the plant began in mid-2017 and has been completed in March 2019. The first vehicles are scheduled to roll off production lines in mid-2019. Kia president Han-Woo Park announced that the first model produced at the plant would be an SUV(sport utility vehicle) specifically designed for the Indian market. [43] [44] Park also added that Kia would invest over $2 billion and create 10,000 jobs in India by 2021. [45] [46]

Automobile components

Hitachi announced an auto-component plant in Chennai by 2016 with an increase in their India employees count from 10,000 to 13,000. [47]

Aviation

Before the Make in India campaign had been put in motion, the first deal to have been done under the broader Atmanirbhar Bharat campaign was the Fairchild-Dornier 228's manufacturing by the Hindustan Aeronautics Limited, by Pushpindar Singh Chopra. [48] French drone manufacturer LH Aviation announced a manufacturing plant in India to produce drones. [49] During Magnetic Maharashtra: Convergence 2018, Thurst Aircraft Pvt Ltd signed a MOU with Govt. of Maharashtra to build an aeroplane manufacturing plant near Palghar district (roughly 140 km north of Mumbai) with an investment of ₹35,000 crore($5.2 billion). [50]

Biotechnology

On 6 July 2024, Horiba's largest medical equipment and hematology reagent production facility in India was officially opened in Nagpur. The company plans to invest ₹200 crore in phases at the Nagpur plant, which will cater to more than 30,000 hospitals and diagnostic facilities. It will produce medical consumables (reagents), clinical chemistry equipment, and equipment for blood tests. It will act as a hub for exports to nearby nations, with a 50% localization objective initially, and a target of 80–90% localization of products in the future. With aspirations to eventually expand into the Materials & Semiconductor and Energy & Environment sectors, the factory will initially serve the Bio & Healthcare segment. [51]

Defence manufacturing

As part of Prime Minister Narendra Modi's Narendra Modi Atma Nirbhar Bharat Abhiyan (Self Reliant India Campaign), India's ministry of defence last month reserved 26 items that will only be procured from the local suppliers. [52]


India and Russia have deepened their Make in India defence manufacturing cooperation by signing agreements for the construction of naval frigates, KA-226T twin-engine utility helicopters (joint venture (JV) to make 60 in Russia and 140 in India), Brahmos cruise missile (JV with 50.5% India and 49.5% Russia). [53] A defence deal was signed during Prime Minister Narendra Modi's visit to Russia in December 2015 which will see the Kamov Ka-226 multi-role helicopter being built in India, was widely seen as the first defence deal to be actually signed under the Make in India campaign. [54] [55] In August 2015, Hindustan Aeronautics Limited (HAL) began talks with Russia's Irkut Corp to transfer technology of 332 components of the Sukhoi Su-30MKI fighter aircraft under the Make in India program. These components, also called line replacement units (LRUs) refer to both critical and non-critical components and fall into four major heads such as Radio and Radar; Electrical & Electronics System; Mechanical System and Instrument System. [56]

Lockheed Martin announced in February 2016 its plans to manufacture F-16 in India, although it did not announce any time frame. [57] In February 2017, Lockheed stated that it intended to manufacture the F-16 Block-70 aircraft with a local partner in India, if the Indian Air Force agreed to purchase the aircraft. [58]

Boeing announced setting up a factory to assemble fighter planes, either the Apache or Chinook defence helicopter in India, [59] as well as the manufacture of F/A-18 Super Hornet. [60]

Prime minister Narendra Modi launches Make in India. Narendra Modi launches Make in India.jpg
Prime minister Narendra Modi launches Make in India.

In May 2018, the Indian Army announced a ₹50,000 crore (US$6.0 billion) ammunition production project to be implemented in phases over a 10-year period. Under the project, 11 private firms will manufacture and supply ammunition for the Army's tanks, rockets, air defence system, artillery guns, infantry combat vehicles, grenade launchers, and other field weapons. The Army noted that the objectives of the program were to cut dependence on foreign imports and to establish an inventory of ammunition that would sufficient to fight a 30-day war. [61]

Electronic systems

With the demand for electronic hardware expected to rise rapidly to US$400 billion by 2020, India has the potential to become an electronic manufacturing hub and government is targeting to achieve net zero imports of electronics by 2020. [62] After the launch of this project, 24.8% of smartphones sold in India in the April–June quarter of 2015 were made in India, up from 19.9% the previous quarter. [63] [64] [65] By 2019 that number has jumped to 95%. [66]

Various companies pledged investment in India to begin manufacturing

Food processing

Pitha of Odisha, Gushtaba of Kashmir, Chicken Curry of Punjab, Khakhra and Khandvi of Gujarat, Bamboo Steam Fish, Vada and Medhu Vada of Karnataka, Khaja and Inarsa of Bihar, Kebab of Uttar Pradesh and Puran poli of Maharashtra have been selected as traditional regional food to be promoted in the ongoing campaign. [90]

Marine Products Export Development Authority announced the deal to supply shrimp eggs to farmer in India for eventual exports of shrimp from India to other countries. [91]

In Odisha Investor Summit, Poseidon Aquatech announced plans to undertake shrimp farming and processing in the state at the cost of ₹100 crore ($14.7 million). [92]

Noodles manufacturer Indo Nissin Foods Ltd also announced that it intended to invest additional ₹50 crore ($7.3 million) to expand the existing facility in Odisha by 2017. [92]

Mining

During Odisha investor summit, NLC India signed an MOU with government of Odisha to set up a coal mining processing plant at the cost of ₹7,500 crore ($1.1 billion). [92]

Railways

Vande Bharat Express with "Make in India" initiative Rani Kamalapati Vande Bharat Express train 20230331123704332462.jpg
Vande Bharat Express with "Make in India" initiative

Renewable energy

In August 2016, NLC India announced that it is going to set up a 500 MW solar power plant in Odisha at the cost of ₹3,000 crore ($441 million) [92]

Thermal power

In May 2017, the Union Cabinet approved the construction of 10 indigenously built Pressurised Heavy Water Reactors (PHWRs). The contracts for the reactors worth an estimated ₹70,000 crore (US$8.4 billion) will be awarded to Indian companies. The construction 10 reactors with a combined nuclear capacity of 7 GW is also expected to create 33,400 direct and indirect jobs. [96]

During Odisha investor summit, NLC India signed an MOU with government of Odisha to set up a 2,000MW Thermal power plant at the cost of ₹15,000 crore($2.2 billion) [92]

Wellness and Healthcare


Assam Cancer Care Foundation is a joint partnership between the Government of Assam and the Tata Trusts. Tata Trust said that setting up of six cancer hospitals and laying the foundation stone of seven new cancer hospitals has raised Assam in terms of higher level of healthcare and treatment of cancer not experienced by other states of the country. [97]

In Assam investor summit, Indo-UK Institute of Health announced that it will set up a medical city in Guwahati at cost of ₹1600 crore ($231 million). [98]

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References

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