make in india to change delhi-ncr business landscapeboilerindia.com/boilerindia_printmedia.pdfsector...
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class manufacturinginfrastructure acrossthe country with focuson railways, roads,ports and inlandwaterways and housingfor all. India has a lowercontribution from themanufacturing sectorto the GDP at 17%compared to 36% inChina, 23% in Korea
and Germany.To ensure success of
the initiative and turnthe dream of India as amanufacturing hub intoground reality, thegovernment hasannounced severalincentives such asdeclaring the roadsector as an industry,simplification of
regulatory compliance,improvement inresource managementprogramme, duty-freeimports of certainidentified equipmentfor construction plants,FDI of up to 100 percent in certainmanufacturing sectorsand 25% tax on thenew manufacturingcompanies. Overall, thereduction in logisticscost through rail-portconnectivity, availability
of raw-materialfeedstock within theregion, the pro-activepolicies of thegovernment, the hugeinvestment interest byglobal majors and mostimportantly a hugemarket forconsumption is set toredefine themanufacturinglandscape in the Delhi-NCR region inparticular and acrossthe country in general.
CONSUMER CONNECT INITIATIVE
Make in India to change Delhi-NCR business landscapeend-use industries ofauto, packaging(including bulkpackaging),plasticultureapplications,electronic appliances,etc. which areconcentrated mostlyin UP and Delhi- NCR(more than 50%).However, plasticprocessing in otherparts like Rajasthan,Punjab, Haryana,Uttarakhand, J&K andHimachal Pradeshare expected to growbased on increasedavailability offeedstock and higherfocus onmanufacturingsectors as part ofMake in Indiainitiative andDedicated FreightCorridor.
The synergiesbetween feedstockavailability in NorthIndia close to theconsumption areawould boostmanufacturing andprocessing of
petrochemicals intoplastic end productslike pipes, tubes andstorage tanks. As perone report, theIndian PVC pipes andfitting markets willgrow at double digitCAGR over the periodof 2015-2020 toreach Rs 32,700 croredue to increaseddemand from theirrigation sector,construction sectorand moreimportantly due togradual replacementof conventionalpiping systems.
Moreover, at157.35 millionhectares, India holdsthe second largestagricultural land inthe world with only44% under irrigationand a substantial partof this being in theland-locked NorthIndia. Fluctuations inrainfall and threat ofdrought has led tothe government'sfocus on increasingirrigation coverageleading to demandfor plastic pipes andstorage tanks.
The availability offeedstock fromPanipat would alsoboost the ancillarymanufacturingactivity in Delhi-NCRregion, which isalready establishedwith largeautomobile, fastmoving consumergoods and heavyindustries. Severalmanufacturingcompanies such asMaruti Suzuki,RanbaxyLaboratories, EscortsGroup, Honda, GSKConsumer andNestlé India arepresent in the NCR,which has beenenriched by a rich
reservoir of skilledand relatively lowcost workers withgood infrastructureand harmoniousindustrial relations.
Apart from theDelhi-NCR area,other prominentmanufacturing hub inNorth India derivingimpetus includeGurgaon, Dadri-Noida-Ghaziabad,Manesar-Bawal,Kanpur, Lucknowand Chandigarhthrough the Make inIndia initiative alongwith the dedicatedfreight corridor in andaround these cities.The westerndedicated freightcorridor connecting adistance of 1483 kmbetween Delhi andMumbai will be abroad gauge railwaycorridor that willbring down thelogistics cost for thetrade in the land-locked northernstates by connectingthem directly with
JNPT - the hub porton the west coast.
To add to thisimpetus, the Make inIndia initiative withfocus onmanufacturing andimport substitutionwill not onlytransform the Delhi-NCR region, but alsocontribute to theeconomictransformation ofseveral other cities inthe western regionincluding Mumbai,Pune, Bhiwadi,Jaipur, Ahmedabad,Vadodara and Panaji.Other cities in theeastern and southernregion includeKolkata, Guwahati,Patna, Jamshedpur,Hyderabad,Vishakhapatnam,Bangalore, Chennaiand Coimbatore withcooperative,collaborative andcompetitivefederalism.
Make in Indiainitiative, launchedwith an aim to boostindustrial growth, hasalready caught theimagination of globaleconomicpowerhouses thathas resulted in aninvestmentcommitment of overRs 15 lakh crore. Thiswas an outcome ofthe participation ofover 2,500 globalplayers from 70-oddcountries and 8,000domestic companiesat the week- longevent held earlier inFebruary this year.
The initiative aimsto enhancemanufacturingcontribution to theGDP by facilitatinginvestments, fosterinnovation, protectintellectual propertyand build best-in-
Kamal Poddar, ManagingDirector, Choice Group
Plastics are derivedfrompetrochemicals
and are increasinglyfound in automotive,construction, electronics,healthcare, textiles andconsumer goodsindustry. Hence with theincreasing presence ofrefineries in the westernregion coupled with
options of importingdue to proximity ofports, the consumptionof plastics was so farmore tilted in thewestern part of thecountry, accounting forclose to 50%.
However, thecommissioning of IndianOil Corporation'spetrochemical complex
at Panipat has openedup the doors for theNorth Indian market toset up downstreampolymer processingunits to cater to thedemand of the land-locked states.
According to a FICCIreport, the bulk ofconsumption innorthern India is from
THE ECONOMIC TIMES, NEW DELHI, TUESDAY, MAY 17, 2016
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Make in Indiaengages several keydrivers to boost themanufacturing effort.Under 'Ease of DoingBusiness', India aimsto achieve a rank of50 in the World BankDoing Businessindicators in the nextthree years. Acoordinatedprogramme has beeninitiated acrossministries and stategovernments toincreaseadministrativeefficiency throughsimplified, time-bound and onlineprocesses.
Infrastructure andindustrial corridorswith world-classfacilities andconnectivitiesconstitute the secondpillar of the Make inIndia programme.Industrial Corridorshave been identifiedacross the country,comprising NationalInvestment andManufacturing Zonesas manufacturing andurban hubs. Inaddition, ForeignDirect Investment isbeing encouraged byfurther opening upsectors andfacilitating entry ofoverseas investors.
Technology,innovation anddesign are central toMake in India,supported by strongerIntellectual PropertyRights regime and theinnovative Start-upIndia, Stand Up Indiacampaign. Further,skill developmentunder the Skill Indiamission is also beingaddressed in missionmode by thegovernment.
Make in Indiasynergises with otherdevelopmentalcampaigns as well,including SmartCities, Digital India,and Clean Energy.Twenty-five sectorshave been identifiedfor promotionalpolicies, cuttingacross manufacturing,infrastructure andservices sub-sectors.
Taken together, themany policyinstruments establisha sound foundationfor the growth of themanufacturing sectorand create newopportunities forIndian manufacturers.Take defense, forexample, where anew policyencourages privatesector participation inprocurementestimated at $260billion. In railways, anambitiousprogrammeenvisagesinvestments worth Rs8.5 lakh crore in thenext five years. Theelectronicsmanufacturing sectoris expected to attract$100 billion worth offunds by 2020.
The prospects forthe small andmedium enterprises(SMEs) areparticularly exciting asentire value chainsare restructuredunder Make in India.
Partnerships withlarge firms will enablemanufacturingoutsourcingopportunities across arange of sectors fortier-1 and lower-tiersuppliers. Under Easeof Doing Business,setting up andregistering units isbeing facilitated, andreturns and labourregulations areundergoingsimplification throughonline processes.
In alignment withthe government'spolicies, CII hasundertaken manyinitiatives under theMake in Indiaumbrella. We wereprivileged to be theexclusive partner forthe mega-event,Make in India Week,hosted by theGovernment of Indiaand the Governmentof Maharashtra atMumbai in Februarythis year. The Make inIndia Week wasattended by morethan 2000 foreigncompanies from 102countries and almost70 business missionsfrom overseas.Altogether over 1,000foreign delegatesparticipated, alongwith about 1,000CEOs and industryleaders, 9000 Indiancompanies and about4000 foreigndelegates participatedduring the Make inIndian Week. Thisevent strengthenedthe India brand,showcased thesuccesses of ourmanufacturing sector,and helped connectforeign and Indianfirms for real businessopportunities.
CII is also workingwith the Departmentof Industrial Policyand Promotion(DIPP) and stategovernments on 'Easeof Doing Business'. Itis also identifying topsectors where Indiacan emerge as aworld champion,along with policyrecommendationsthat can unlock thepotential.
In line with the'Zero Defect, ZeroEffect' aspiration forhigh-quality andsustainablemanufacturing asenunciated by theprime minister, CII isstrengthening theservices provided byits Centers ofExcellence. Targetingthe areas of quality,competitiveness, andproductivity as well asgreen business andenergy efficiency,among others, theCenters offer a range
of capacity-buildingprogrammes formanufacturing firmsthat help them attainglobal benchmarks.
Innovation andtechnology are corestrengths for CII andwe are engaged increating awarenessand strengtheningcapacities of Indianenterprises throughseveral partnershipprogrammes with stategovernments andoverseas institutions. Itis critical to build theinnovation pipeline in
manufacturingcompanies, given theadvent of the FourthIndustrial Revolutionincluding additivemanufacturing,robotics, and theinternet of things.
Make in India is trulya visionary mission andindustry is fullycommitted to makingit a success for thecountry's progress.
The author isPresident,
Confederation ofIndian Industry
Dr Naushad Forbes
Make in India' isan innovative,multi-pronged
campaign launched bythe government to re-energize themanufacturing sector.Introduced at a timewhen manufacturinggrowth was subdued,it envisions raising thecontribution of thesector to 25 per cent of
the GDP and, in theprocess, creating 100million new jobs. Italso aims at integratingIndian goods in globalvalue chains.
CII has stronglywelcomed andsupported the Make inIndia mission as itbelieves that it cancatalyse new jobcreation of the scalenecessary to achieveour aspirations to
become a developednation. The primeminister's action planto transform themanufacturing sector ispractical and relevantand CII is committed topartnering with thegovernment.
The manufacturingsector, estimated togrow at 9.5 per cent in2015-16 over a growthof 5.5 per cent in 2014-15, contributes about
17 per cent to GDP andemploys 12 per cent ofthe Indian workforce. Itis estimated that 10-12million young peoplewill enter theworkforce each yearfor the next twodecades and each 1percentage pointincrease inmanufacturing growth,could create as manyas 20-30 millionadditional jobs.
CONSUMER CONNECT INITIATIVE
A Robust Platform for Indian Manufacturers
THE ECONOMIC TIMES, MUMBAI, FRIDAY, APRIL 29, 2016
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