It should spur manufacturing across the value chain, across sectors, sizes, geographies & lead to inclusive growth
The country really needs the Make In India campaign. This is the first time such a large scale initiative is being led by the government. Earlier, there were just feeble attempts at change by industry bodies and small associations, and some leading organizations that believed in the philosophy of creating and capturing value for India. We have reason to believe that this campaign will be successful because the intent and the purpose of the campaign is clear and the fact that this time it is being led by the Prime Minister of the country is the differentiating factor.
It should spur manufacturing across the value chain, across sectors, sizes and geographies and lead to inclusive growth. The power of this initiative is that it is size neutral for the manufacturing sector. It will have a ripple effect not only on the large-scale industries, but also on medium and small scale units including ancillaries.
We need both the big industries as well as entrepreneurs to grab this opportunity. However, there are three broad challenges that I foresee. Firstly, it should not just remain a campaign, but it is necessary to create an entire facilitative ecosystem to promote and encourage participation in the growth process. Talking about the ecosystem, all policies and laws will have to be looked at and addressed simultaneously and on an urgent basis, lest the momentum is lost and skepticism sets in. The next one year will be very critical, because this is the time all such hurdles need to be addressed.
The second hurdle that I foresee is the lack of skilled manpower. We have the vision and the direction, but the question is are we are ready with the supply chain when it comes to skill? You can reform policies, but you cannot create skills overnight. Example – do we have adequate electricians that may be needed? So we need to have a very proactive approach that aims to make up for the lost time without diluting quality.
The third hurdle that I see is lack of adequate infrastructure. Example, you may have the opportunity, a willing partner and adequate people resources, but if there is no adequate power, then there is a very limited scope of going forward. These three hurdles need to be simultaneously and comprehensively addressed with immediate focus on low-hanging fruits to ensure that the purpose of this campaign materializes.
Remove negativity from contract labour
Somewhere, we have to accept the reality of contract labour and work with the unions and remove this negativity attached to contract labour. This will be critical for the campaign to succeed. The ratios have to be addressed according to the scale and size. Over time, too much negativity has been attached to contract labour because organizations are neither paying minimum wages to them, nor extending social benefits or even maintaining the basic working conditions. If these are not addressed, then it will become a recipe for disaster. That is where the government will have to play a very active role by ensuring the implementation of all the labour laws. The corporation, as the principal employer, also has to take the responsibility to ensure that all the benefits for contract workers are delivered. It is a statutory responsibility cast on them.
Made In India – The right time?
I think we should start with ‘Make in India’, and after that look at ‘Made in India’. The key driver should be to create a growth trajectory that provides jobs, which is the immediate priority of the campaign. According to a recent data, only 2 out of 12 people getting into the working age are getting jobs. If we do not focus on creating jobs, it will become a huge social issue to grapple with.