Prime Minister Narendra Modi on Friday exhorted global firms to set up manufacturing facilities in India and make the country a hub for global manufacturing.
“From the ramparts of the Red Fort, I would like to call people of the world to ‘come, make in India’. Come here and manufacture in India. Sell the products anywhere in the world but manufacture here...we have the power, come I am inviting you,” Modi said in his maiden Independence Day speech.
The domestic manufacturing sector has stagnated in the last couple of years due to a stubbornly sluggish economy hampered by high inflation and interest rates.
A steep decline in investment in the last two years has resulted in the share of manufacturing in the country’s overall GDP stagnate at around 18% against the government’s target of 25%.
Read: Industry cheers Modi's 'Make in India' focus
Modi called on the youth to become entrepreneurs and manufacture ‘zero-defect, zero effect’ goods with the aim at increasing the sector’s contribution to GDP to the targeted25% within the next 10 years. Zero effect, he explained, means having no negative effect on the environment.
“I would like to tell the youth that our dream should be to take the ‘Made in India’ brand at every nook and corner of the world,” he said.
“They should do research to identify at least one product which they can manufacture and help in reducing the country’s import bill. Not only this, but they should look at exporting those items as well. If every youth of this country would start manufacturing at least one product, our country will become an export hub,” the Prime Minister said.
The image of India as a preferred investment destination has taken a beating in recent times due to various regulatory hurdles in acquiring environmental clearances and myriad problems in land acquisition.
India ranks a lowly 134 out of 189 countries in the World Bank’s ease of doing business index in 2014. It slipped three places from its 2013 rank.
Lack of convergence on various matters between the state and central governments has also irritated the industry best exemplified by long pending multi-billion dollar projects like Posco and ArcelorMittal’s steel plants that have failed to take off in almost a decade.
The formation of the Modi government in May — the first with a clear majority in three decades — has, however, raised hopes and seen a barrage of investments to the tune of $80 billion in the last three months.
On Friday, Modi said global businesses can invest in a wide range of areas including electrical, electronics, chemicals, pharmaceuticals, satellite and submarine but cautioned that there should be no compromise on quality of product or any ill-effect of manufacturing on environment.
“Our manufacturing should have zero defect so that our products should not be rejected in the global market. Besides, we should also keep in mind that manufacturing should not have any negative impact on our environment,” he said.