Make in India: How PM Narendra Modi’s pet project is beyond sloganeering

Ahead of the Quad Leaders’ Summit, Prime Minister Narendra Modi had a roundtable in Tokyo with the top CEOs and executives of Japanese firms and invited them to “Make in India for the World”. Soon after, the Union Minister for Commerce and Industry, Piyush Goyal, visited the United Kingdom. While in London, he addressed a sectoral roundtable of investors, including Fintech, venture capital funds, and banks, and outlined how “Make in India for the World” would enable British companies to leverage cost competitiveness, scale, and skill to become global champions. So, is it just a catchy slogan that the Modi government is using for public consumption, as the Opposition claims, or is there more to it than we realise? Putatively, the primary object of the Make in India scheme has been to increase manufacturing within the country to create job opportunities and to ensure that the manufacturing sector's contribution to GDP is increased to 25 per cent by 2025, which is presently revolving around 17 per cent (2021 data) and was a tad over 14 per cent in 2016. The Opposition generally mocks at the “Make in India” schemes, claiming that they have ostensibly failed to produce the desired results. The supporters of the government present rosy pictures and endless arguments to demonstrate the success story of Make in India. All these questions can be answered using vital relevant data because numbers speak louder than arguments. The export of merchandise products and FDI in the manufacturing sector is the best parameter to judge the success or failure of the scheme. If India's manufacturing base is expanded, exports will naturally increase, and vice versa. The FDI inflow meter in manufacturing can also be a barometer to measure the success or failure of the scheme. From FY14-15 to FY17-18, the export of manufactured goods was around Rs 17-19 lakh crore. There was a sudden spurt in merchandise exports in FY18-19, clocking export turnover of Rs 23.07 lakh crore, registering growth of 17.95 per cent YoY (year-over-year). The COVID-19 pandemic had halted this growth again for two years, and export of merchandise produced a reduction of Rs 21.60 lakh crore for FY20-21, but in FY21-22 it has again increased to Rs 31.46 lakh crore, registering a YoY growth of 45.72 per cent, which is a historical one and probably the highest in recent decades in terms of value and growth percentage. People may argue that growth in rupee terms is higher due to the depreciation of the rupee, but exports in dollars for FY2021-22 are also pegged at $421,890 million representing 44.58 per cent YoY growth. India is now not only the largest importer of crude oil and petroleum products but also petroleum products account for the highest export in the previous fiscal year, accounting for around 21 per cent of total turnover, totalling more than Rs 6.5 lakh crore. Biggest contributor was pearls, followed by gems, which constitute around 8.5 per cent of India's total exports. Iron steel and medicinal products are not far behind, which are also around 6.5 per cent and 6 per cent, respectively, of total export turnover. The product categories of top export items themselves show that the manufacturing base is making inroads in India. After the COVID-19 pandemic, European countries are now considering India to be a trusted partner, which is evident from the fact that exports from India registered the highest growth in EU countries. The export of merchandise goods to EU countries has reached its highest ever turnover of more than Rs 6.40 lakh crore, registering growth of more than 60 per cent from the immediate financial year. Surprisingly, the Netherlands became the largest importer of Indian merchandise products, importing more than Rs 90,000 crore in value, up from around Rs 45,000 crore the previous year. *** Also Read New India’s five big, surprising trends and what they mean Rise of creator economy and why India needs a new skilling paradigm Weak currency, strong economy: How India is on the path to becoming ‘aatmanirbhar’ One vision and a billion people’s dream for a $5 trillion economy IMF is wrong: India doesn’t have to wait till 2029 to be a $5 trillion economy; it can still be done by 2025 *** The success story of Make in India can also be seen in another segment, which is the electronic segment, including telecom instruments. The world’s leading companies have made India the assembly point for their electronic products, with exports in this segment exceeding Rs 1.10 lakh crore in fiscal year 2021-22. Telecom instruments alone clocked an export turnover of more than Rs 55,000 crore in the last financial year. More often than not, Gujarat remains the leader in exports. As per the Niti Aayog's second edition of the Export Preparedness Index 2021, released this March, Gujarat has emerged as the top-performing state, beating other coastal economic powerhouses such as Maharashtra and Tamil Nadu. Gujarat led the export contribution in India with its total share accounting for 20.83 per cent as of 2020-21, followed by Maharashtra with a 20.06 per cent share. Likewise, the FDI in India was around Rs 4.5 lakh crore in the current year, which was around Rs 2.5 lakh crore in FY 2015-16. Computer software and hardware segments attracted the highest FDI, which was more than Rs 1.10 lakh crore, followed by the automobile industry, which attracted more than Rs 55,000 crore FDI, compared to Rs 12,000 crore in the previous year. Despite the fact that exports of manufactured goods have reached an all-time high, India is concerned that the trade deficit is widening due to increased imports. This May's trade deficit was pushed up by a surge in imports, which rose 62.83 percent YoY, while exports rose 20.55 percent, revised trade data released by the Ministry of Commerce and Industry showed. The Make in India initiative will continue. In the coming years, an increasing number of manufacturers are anticipated to establish operations in India. Prime Minister Narendra Modi is personally driving a wave of changes that will modernise and open up India's economy. As a result, India's economic climate is becoming progressively freer. Assuredly, India has no time to relax. It must continually strive to become the most popular business destination on the globe. Yuvraj Pokharna is an independent journalist and columnist. Mukesh Kabra is a Surat-based Chartered Accountant practicing from 25 years. Views expressed are personal. Read all the Latest News , Trending News ,  Cricket News , Bollywood News , India News and Entertainment News here. Follow us on Facebook , Twitter and Instagram .

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