The document discusses the need for India to focus on manufacturing through initiatives like "Make in India" and "Skill India" in order to generate more employment and reduce poverty. It notes that manufacturing makes up a smaller share of India's GDP compared to countries like China. The document advocates for policies to improve infrastructure, skills development, technology and innovation to make Indian manufacturing more competitive globally and attract more investment. It also discusses the important role small and medium enterprises can play in strengthening manufacturing.

1. PRESENTED BY:
SARJU MEITANKEISANGBAM
ID:14MBAAB032
MBA(Agribusiness) -2nd SEM

2.  INADEQUATE GROWTH in manufacturing has its adverse
impact on employment generation in India. The current
mismatch between distribution of workforce and value
added in agriculture is one of the main reasons for the
large number of poor in our country.
 In a highly globalised economy, the need for enhanced
export competitiveness needs no introduction.
 India must aim to match China in manufacturing given the
low-cost labour with the added virtue of skills
 The share of manufacturing sector in gross domestic
product in India is 17 per cent compared to 33 per cent in
China,29 per cent in Korea ,25 per cent Brazil and 27 per
cent in Thailand.

4.  However , we are short in other resources and
infrastructure that investors seek , a weakness that has
checked the flow of investments into skill-intensive
manufacturing.
 Recent trends in some sectors , such as auto and auto
components, speciality chemicals, generic drugs and
engingeering,however , suggest a vast scope for global
manufactures to locate here.
 The policy thrust outlined by the Prime Minister through
the two flagship programmes, ‘ Make in India’ and ‘Skill
India’ ,should be understood against this background.

6. The Need for ‘Make In India’
‘Make in India’ is a timely policy initiative to convert
India into a global manufacturing hub. In order to
attract new investments and promote manufacturing
,this programme addresses the problem areas in the
manufacturing sector through different channel of
interventions include a the E-Biz portal ending 24*7
applications of industrial license making the process
seamless . The policy has given approval to National
Investment and Manufacturing Zones, wherein , the
provision for single window clearance will be provided.

7. The Need for ‘Skill India’
 The Modi government launched a new skill development
policy by March 2015 that would bridge the gap between
educational institutions and the labour market, minister of
state for skill development and entrepreneurship
Sarbananda Sonowal said.
 The new scheme is expected to move beyond the target of
skilling 500 million youth by 2020 that was set by the UPA
government.
 A multi skill development programme on mission mode for
job creation and entrepreneurship for all socio-economic
classes is being worked out. This will facilitate mobility of
workforce.

8. Role of MSME in ‘Make In India’
 MSMEs can play a critical role to strengthen the ‘Make In
India’ initiative by addressing the issues of job creation ,
increasing the manufacturing share in GDP and export
promotion . Already , the sector contributes to around 45
per cent of the total manufacturing output and around 40
per cent of the country’s exports.
 There has been a sustained contribution of the MSME
both in terms of output and employment , inspite of the
slowdown in the economy as a whole and the
manufacturing sector in particular.

9.  And worryingly, it is losing depth . While China’s GDP is
3.8 times larger than India’s , its production of machine
tools , the ‘Mother Industry’ of manufacturing , is 55
times more ! India needs a strategy to grow
manufacturing 12 per cent to 14 per cent annum , create
100 million new manufacturing jobs in the next 15 years
to realize its‘ Demographic Dividend’ , and create more
depth in capital goods industries and innovation for its
manufacturing sector to be competitive and sustainable.

10. Manufacturing Competitiveness :
Meaning and Coverage.
 Competitive economies are those that have in place
factors, driving the productivity enhancements on which
their present and future prosperity is built.
 The World Economic Forum(WEF) defines
competitiveness as the set of institutions, policies , and
factors that determine the level of productivity of a
country.

11. Enterprise Size and
Competitiveness
Naturally, the academic discourse on manufacturing has significantly
created a hegemony, wherein, the roles of small and medium
enterprises was relegated to the background. , that helped to shift
the attention more towards the MSMEs
• According to international statistics , over 50 per cent of small
business fail year and 95 per cent fail within the first five years.
Apart from the usual causes of business failure like inexperienced
entrepreneurs , poor locations and lack of capital for growth ,
another reason is complacency.
• Manufacturing competitiveness , in the modern world, need to be
discussed in relation to the process of globalization ,and
liberalization of the economy.

12. Manufacturing Competitiveness :
issues
 Technology and Innovation Enhancement.
 Initiatives on Skill Upgradation.
 Entrepreneurship Policy.
 Development of Knowledge Systems
1. Knowledge Generation and Acquisition : This happens
through scientific discovery , R&D, transfer of tech. ,
organization , and cultural practices.
2. Knowledge Adaptation : This should happen through
innovation to particular fields , needs and operating
environment.

13. Role of infrastructure
 A modern , well-organized and widespread infrastructure
is a pre requisite for a country’s economic growth.
Ministry of Finance estimates that infrastructure projects
of approx INR 1 lakh crore have been delayed.Time and
cost overruns in implementation of projects continue to
be one of the main reasons for under-achievement of the
sector.
 Manufacturing sector which has seen a significant
slowdown over the past few years need to increase its
share of GDP from 15 per cent to 25 per cent .
 Given the above , the new Govt. has ,over the last couple
of months , identified infrastructure development and
growth in manufacturing sector as its key focus areas.

14.  I n China, manufacturing policies are framed to
strengthen domestically owned and managed
capabilities . In fact, the Chinese government is
framing IPR rules to further its own interests ,
suspecting that the rules being imposed on it have
been devised principally to protect foreign companies’
interests. China is using the lever of purchases by govt.
agencies to develop indigenous tech.
 While attracting foreign investments and new
technologies from board is crucial , they must result in
jobs, innovations, and manufacturing depth in India.
The time has come for Indian Policymakers to sharpen
the national manufacturing strategy , on the basis of
the more recent evidences on the changes in the global
economy , vis -a- vis India’s comparative position . The
sustainability of India ’s growth story depends on it.

15. The Way Forward
 Given the importance of infrastructure development and
manufacturing the Govt. can play a key role of a catalyst
in kick-starting growth in the sectors . The Union Budget
2015 has taken some steps to put the economy back on
high growth trajectory.

16. You