The key to success for 'Make in India'

A campaign like ‘Make in India’ needs to be planned well to ensure that demand and supply equations match and match well into the future, says Sanjeev Jha, Director Finance – India, Kelly Services.

To a large extent, the programmes and initiatives of any government are evaluated by their impact on the economy and its people. In recent years, if we were to measure the various government-led initiatives, purely on the basis of the lives they touch across the spectrum of skills, knowledge and growth, then ‘Make in India’ scores rather well. An initiative of this scale that has the world looking up to India brings in a ray of hope to the average Indian for whom more employment opportunities and financial growth are on top of the agenda.

A campaign of sorts that is labour intensive and aims to create jobs across the length and breadth of the country is commendable. We currently have more than 10 million people joining the workforce every year in India. And the potential for impact of a campaign like ‘Make in India’ is huge. Think about the jobs it will facilitate and the entrepreneurship that it will foster.

The de-licensing and deregulation measures that the ‘Make in India’ initiative plans to bring in will open up more sectors, bring in more transparency and support employment across the value chain.

The impetus that developing industrial corridors and smart cities will get will ensure decongestion of employment hubs. This will go a long way in creating inclusive growth for a nation like ours, with diverse geographical and social norms. Between 2011 and 2013, the workforce increased from 393.1 million to 397.4 million in India, where there was a 7.2 million increase in the formal sector workforce. ‘Make in India’ will further increase the number of people entering the formal sector, hence ensuring adequate welfare and security schemes.

However, any such large scale initiative from the government requires discipline to execute and its success is also dependent on the speed at which it is implemented. India is still considered to be difficult for foreign businesses to set up base and grow in. In the World Bank’s Ease of Doing Business Index, our ranking has stagnated over the last couple of years. For foreign investors, more often than not, it’s still a nightmare to start a business in India. This primarily has to do with the complicated tax systems existing in the country and the myriad checkpoints that one has to clear. From a simple company registration to land acquisition to filing of regulatory compliances each step is complicated and not at all investor friendly. Is the government ready to look into this aspect and bring in some drastic reforms?

The success of ‘Make in India’ needs meticulous planning and cooperation between state and central bodies.

From an employment standpoint, ‘Make in India’ ushers well for the workforce entering the job market in the coming years. However, is India geared up to generate a strong talent pipeline to make the best of the available opportunity? Do we have enough workforce with adequate skills in place to meet the requirements? Will mobilising talent within the country be enough? Will ‘Make in India’ campaign help in recognising employable skills and include them in the curriculum of vocational training institutes? Will there be adequate vocational training institutes across the country? These are some of the questions that need to be thought through in detail for the campaign’s success.

The foreign investments hat will come into the country through this campaign will contribute to employment across industries and related ancillary units as well. However, such investors typically need confidence in the skill landscape of the geography where they are investing. That is as important as the benefits that accure from saving on labour costs. A weak roadmap on creating a sustained talent pipeline will sabotage ‘Make in India’.

The National Skill Development Corporation has been training about 3 million candidates every year. The institute is also gearing up to meet the expectations of the government to churn out more skilled talent. Subsequent to the launch of ‘Make in India’, the government has introduced the ‘Skill India’ programme that has ambitious plans of training 500 million Indians by 2020. ‘Skill India’ will emphasise training for candidates in different areas including real estate, construction, transportation, textile, gem industry, jewelry designing, banking and tourism. The intent is to focus on sectors where skill development is inadequate or nil.

A country like India requires a strong Public-Private-Partnership (PPP) model to realise the true potential of ‘Make in India’. Quality training institutes that are adequately staffed, with good infrastructure, adequate training tools and updated curriculum will help ensure that the students who graduate from such institutes are competitive. Such employees will obviously consume fewer investments on training.

A campaign like ‘Make in India’ needs to be planned well to ensure the demand and supply equations match. The success of the campaign also needs greater collaboration between the state and central bodies. The focus clearly needs to be on generating specialised, skilled and a global workforce that can catapult India into a manufacturing hub. The road ahead is unlikely to be easy, especially when the contribution of manufacturing to our economy has come down to around 15 per cent, from its peak level of 16.9 per cent in 2009 – 2010. Outdated legislation needs to be replaced. A strategic framework needs to be in place with a clear roadmap across levels. Bureaucrats need to be given a free hand with their progress monitored closely. More infrastructure needs to be created in the form of ports, surface transport for ‘Make in India’ to succeed. Corruption needs to be stalled at all levels to ensure files move fast and do not gather dust for months together. Can all of this be achieved easily? Unfortunately not. We as a country are still far behind China in terms of an aggressive mindset to growth and competitiveness. So, are we hopeful of ‘Make in India’? Let’s wait and watch. Only one thing is certain. It is a long road ahead.

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