Make in India Initiative: A Decade of Progress and Challenges

Over the past decade, India has made significant strides in manufacturing, particularly in electronics, as evidenced by companies like Tata Group and Foxconn establishing iPhone production facilities in the country. The Production Linked Incentive Scheme has also been pivotal in encouraging both local and foreign investments across various sectors. However, the share of manufacturing in India’s GDP has decreased from 18% in 2012 to approximately 14%, highlighting a need for improved competitiveness and higher-skilled job creation. Experts emphasize the importance of vocational training and infrastructure development to address these challenges and enhance India’s position in the global manufacturing arena.

Progress Made

• Electronics Manufacturing: India has emerged as a significant player in electronics, with Apple planning to increase its iPhone production share in the country from 14% to 24-25% by 2028. The establishment of facilities by major players like Tata Group and Foxconn showcases the shift towards manufacturing.
• Infrastructure Improvements: The government has invested heavily in infrastructure, resulting in a six-fold increase in highway construction and enhanced freight train speeds, which have improved connectivity and logistics for manufacturing.

Ongoing Challenges

• GDP Contribution: Despite progress, the manufacturing sector’s contribution to GDP has not seen the desired growth, with predictions suggesting it may rise to only 21% by 2034. This indicates a need for more robust policy implementation and industry support.
• Foreign Direct Investment (FDI): FDI in manufacturing has been sluggish, with recent data showing a five-year low. The focus has largely remained on the IT and services sector, necessitating a shift in strategy to attract manufacturing investments.

Future Outlook

The future of the “Make in India” initiative hinges on addressing these challenges through targeted skill development, improved infrastructure, and a strategic focus on attracting foreign investment. As the competition from other emerging markets intensifies, India must leverage its lower labor costs and large domestic market to carve out a significant share in global manufacturing.