INDIAN ECONOMICS IN THE GLOBAL SCENARIO PROJECT

MAKE IN INDIA

ADMIN GROUP 3
Deshna Mehta (C011)
Dhairya Jain (C012)
Dhruvi Nathwani (C013)
Ekansh Arora(C014)
Gunjan Kapoor (C015)
ABSTRACT
India is one of the world’s fastest growing economies, the tenth largest in the world by nominal
GDP and the third largest by purchasing power parity (PPP). India needs to identify the steps
being taken to give more financial powers to states, increased investment on infrastructure,
emphasis on manufacturing which enables to open the door for investment. This Make in India
campaign guides the foreign investors, prompt response, assistance to foreign investors and
provide relevant information and proactive approach. This paper covers overview of the Make in
India campaign, sectors covered, growth cycles, challenges, opportunities and foreign investment
in Indian manufacturing. The study found that, Make in India will bring a drastic change in the
fields like automobiles, aviation, biotechnology, defense, media, thermal power, oil, gas and
manufacturing sectors. Thus, we can conclude that, despite the fact that “Make in India” though
came at a right time, its execution remains a big challenge.

Key words : Make in India, Foreign Direct Investment, manufacturing, Gross domestic
product, economy.
 CONTENTS

PARTICULARS PAGE NO.

Introduction 1
Research Objectives 2
Research Methodology 3
Literature Review 4
Why Make in India and sectors covered 8
Policies and Initiatives taken by Government of India 10
Impact on the Indian Economy 12
Social Impact 14
Global Response 15
Challenges 16
Analysis 17
Recommendations 19
Conclusions 20
References 21

INTRODUCTION
India is a country rich in natural resources. With abundant labour, both unskilled and skilled, easily
available and given high rates of unemployment among the educated and uneducated class of the
country, an action had to be taken.

In addition, the trend in the developed countries and developing countries like china, the
manufacturing sector contributes around 42–50% to the country’s GDP and employs about 40–50%
of the total workforce which was not the case in India.

The Make in India initiative, BJP-led NDA government's flagship campaign, launched by Prime
Minister Narendra Modi on September 25, 2014, intended to boost the domestic manufacturing
industry i.e. to encourage companies to manufacture their products in India and attract foreign
investors to invest into the Indian economy.

The primary goal of the campaign is to make India a global manufacturing hub, by encouraging
both multinational as well as domestic companies to manufacture their products within the nation.
The campaign is led by the Department of Industrial Policy and Promotion. It aims to raise the
contribution of the manufacturing sector to 25% of the Gross Domestic Product (GDP) by the year
2025 from 16% in 2014. Moreover, it has brought up multiple new initiatives to promote foreign
direct investment, implement intellectual property rights and develop the manufacturing sector. It
also seeks to facilitate job creation, foster innovation and enhance skill development.
Make in India scheme aims at Elimination of unnecessary laws and regulations and improve India’s
position on the “ease of doing business” index. It has jumped from 130 in 2015 and 2016 to 100 in
2017 to 77 in 2018.
For the campaign, the government of India has identified 25 priority sectors that shall be promoted
adequately. It has been talked about in detail later in the following sections of the paper.

1
RESEARCH OBJECTIVES
By this paper we plan on discussing:

1. To understand the concept of Make in India, sectors covered and its impact on
Indian economy.
2. To study the recent policy measures and incentives taken by government.
3. The challenges ahead and come up with recommendations.
4. To study the correlation of foreign direct investment with macroeconomic variables.

2
METHODOLOGY
The type of research that will be used in this study is qualitative research and quantitative
research. Qualitative researchers aim to gather an in-depth understanding of Make in India
campaign. Quantitative research will include the observations made through statistical
analysis.
The study involves the data collected from the secondary sources. The secondary data has
been collected from journals, Research paper, Newspapers, websites etc.

3
LITERATURE REVIEW
MAKE IN INDIA PROGRAM – AN ANALYTICAL REVIEW

ANAND SAGAR (2016)

The Make In India programme was launched by the government to develop India as a
manufacturing hub alike China and boost the country’s GDP. India is a big market for MNCs and
this programme is launched to compel the sellers to establish their manufacturing units in India.
Manufacturing will help in employment generation infrastructure development, modernisation in
terms of technology and production methods and increase the exports. The government will be
providing the manufacturers with various incentives to set up manufacturing plants to compel the
MNCs and Indian companies to maximise their production in India.

Make in India received a positive response across the globe as various companies came forward to
take advantage of this opportunity. There are various proposals from companies in different sectors
of setting up their plants such as Mobile ( Xiomi, Micromax, Acer, Oneplus) and other electronic
companies (Sony, Gionee, Foxconn), Automobile companies (Maruti Suzuki, Volkswagen), etc.
However India is still not an investor friendly destination due to lack of proper infrastructure,
bureaucracy, etc. The government must try to improve Ease of Doing Business of India as there is a
huge competition from China; an established manufacturing hub since years, while we are lacking
in providing basic facilities to the manufacturers.

IMPACT OF MAKE IN INDIA CAMPAIGN: A GLOBAL PERSPECTIVE

Dr. (Smt.) Rajeshwari M. Shettar (2017)

India is one of the fastest growing economies of the world and to improve the growth rate India
needs to increase the infrastructure investment, emphasis must be given on manufacturing to attract
investments. Make in India was an international marketing campaign to attract foreign investments
and compel them to manufacture their goods in India, for which India need to get a global
competitive advantage alike China. It has established itself as workshop of the world accounting for
22.4% of global manufacturing while India being at 2% due to its less productivity. The campaign
aims at providing a pleasant business environment leading to overall development of India.

Many MNCs and Domestic companies have shown their interest leading to success of this
campaign. Spice Group, Samsung, Hitachi, Huawei, Air Bus Tata JLR and many more have
proposed plans to set up a manufacturing unit or increase the capacity of existing units with Bosch
and Siemens starting their first ever manufacturing unit in India. A number of factors have been
undertaken to ease the business environment, which is one of the main factor promoting
entrepreneurship. The progress of India is sustained through the continuously increasing FDI’s after
the launch of the campaign.

Make in India: Growth and Future Scenario of Foreign Direct Investment

Mohd Azhar-Ud-Din Mal
4
The article talks about how the government has to act as the central pivot of aligning industries,
private companies, public sectors and all stakeholders in realizing this vision. Government has to
put policies in place be it sector reforms, labour reforms or the elimination of business barriers. The
Government of India has taken a number of steps to further encourage investment and improve
business climate. „Make in India “mission is one such long term initiative which will help to realize
the dream of transforming India into a “manufacturing hub‟.
It also talks about how numerous foreign companies are setting up their facilities in India on
account of various government initiatives like Make in India and Digital India. Mr. Narendra Modi,
Prime Minister of India, has launched the Make in India initiative with an aim to boost the
manufacturing sector of Indian economy, to increase the purchasing power of an average Indian
consumer, which would further boost demand, in addition to benefiting investors. The Government
of India, under the Make in India initiative, is trying to give boost to the contribution made by the
manufacturing sector and aims to take it up to 25 per cent of the GDP from the current 17 per cent.

MAKE IN INDIA: New Paradigm for Socio-Economic Growth in India

Dr.Puneet Aneja
Make in India is an ambitious project, but it is one that India needs to kick start and sustain its
growth momentum. With relentless policies towards this end, it is possible to make India the
powerhouse of manufacturing sector in the world. The Indian government through this initiative
aims to put to use its rapidly increasing workforce to productive use, realizing that service sector
though contributing about 55-60% of the GDP cannot be the sole driver of the economy. In the
present paper an attempt has been made to throw some light on the concept of `Make in India’.
Further, an attempt has also been made to review the advantages of this concept and the areas which
are going to gain benefit with this Modi’s concept of Make in India. The campaign has been
concentrated to fulfil the purpose of Job Creation, Enforcement to Secondary and Tertiary sector,
boosting national economy, Converting the India to a self-reliant country and to give the Indian
economy global recognition.

MAKE IN INDIA - MAKING IT WORK - A PROJECT MANAGEMENT PERSPECTIVE

By Raju Rao
The theme of the research paper is to accelerate economic growth and focuses mainly on how after
the Make in India project, the different sectors that have been involved in the Make in India project
have seen an economic growth or a slowdown.
This research paper examines the following points:
a) an analysis of the policy and vision and whether this has been clearly laid out amenable for
implementation.
b)  review of current progress in the Make in India program.
c)  Suggestions and steps needed to implement the program in a better way.

MAKE IN INDIA: A QUANTITATIVE APPROACH

By Rishabh Bhatia and Sarthak Agrawal
Make in India programme was launched by the Government with the aim to emerge out as a global
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manufacturing hub by attracting FDI. India has abundant skilled and unskilled workforce with the
required skills. With the growing inclination towards outsourcing, India is trying to take the
opportunity. The government needs to improve the ease of doing business to attain global
competitiveness. The aim is to increase the market share of manufacturing in GDP to 25% by 2025
from 16% presently. The Make in India programme targets 25 sectors ranging from automobiles to
IT and business processes. The major macro-economic variables: FDI, GDP, Imports, Exports,
Index of Industrial Production, etc. must be looked for a complete transition to manufacturing. The
campaign seems successful, being backed by major legislative and bureaucratic reforms, having a
great potential.

MAKE IN INDIA: IMPACT ON INDIAN ECONOMY

Bharata Bhusan Sahoo
The research paper talks about Make in India as a policy framework that will promote the
manufacturing of products in India and ease foreign investment, ease of business and management
of intellectual property. It covers a handful of 25 sectors including automobiles, biotechnology etc.
The article also talks about annual FDI Inflows to India in Manufacturing till 2016-17. It throws
light upon various policy measures and incentives undertaken by the Central and State governments
like changes in the percentages permitted under different routes and much more to facilitate the
initiative. Make in India will have a positive impact on the India economy as it will contribute
majorly to increasing employment opportunities, exports, expertise, technology upgradation and
much more. But like every coin has two sides, it has its own disadvantages. Over all scenario of
make in India and FDI was a positive summon to prospective investors from all over the world. It
represents a wide-ranging refurbish of processes and policies.

MAKE IN INDIA: Scope and Challenges ahead.

Ms. Swikrati Singh
The article analyses the make in India initiative of the Indian government. It establishes a
comparative study between the Indian and the Chinese markets. India has targeted to create 10-15
millions of jobs per year, which cannot be achieved just by service sector. So it is high time that
manufacturing sector should be focused. However, various challenges like infrastructure, tax regime
are to be dealt with in making the campaign a huge success. We do have a great scope moving
forward with the campaign, as we have a large young population of engineers and scientist and a
quite good number potential industries like the apparel industry, automobiles, pharma etc. to work
in and a favourable business environment including the infrastructure, export and import duties. The
article suggests we should provide good roads, port, supply power and water, and provide basic
facility like education and health and instead of decreasing the deficit, the focus should be to
increase the revenue sources and that is tax.

Role of Make in India as driver of growth in manufacturing sector

Pratiksha Mishra, Dr. Taruna
This article talks about the importance of make in India with the motive to facilitate investments,
faster innovation and build world class manufacturing infrastructure. The initiation of Make in India
Campaign has changed the Paradigm in Manufacturing Sector with a number of companies like
Oppo, Hitachi, Suzuki etc. entering the Indian market. Various persisting issues like the demanding
factor for India to create job opportunities, economic development prompted the launch of this
campaign. The article also points out that the conditions in India is improving for boosting up of
manufacturing
6
sector after “make in India” campaign announcement. Moreover, it gives us economic calculations
for two respective years affected by the campaign. India has been building new skills focusing on
vocational education and is emphasising on innovative ideas and advanced technology. In addition,
the govt. has come up with policy measures and projects to open up India's manufacturing sector.
There are a number of merits of investing in the industry sector and challenges too which have been
talked about in the research paper. “Make in India” mission is one long run initiative which will
accomplish the dream of transforming India into manufacturing Hub.

EXPLORING PROSPECTS FOR MAKE IN INDIA AND MADE IN INDIA

The state of manufacturing sector in India is a cause of great concern especially when seen in
comparison to the massive transformation registered in this sector by other countries in the Asian
continent, in similar stages of development. At around 16% value added of manufacturing to India’s
GDP, the sector does not seem representative of its potential which ideally should have been 25%.
The launch of Make in India programme would play a pivotal role in establishing India as a major
manufacturing hub that will push India on a high and sustainable growth trajectory in the coming
times. In most rapidly developing economies, manufacturing sector contributes 25-40% to the GDP
such as Thailand’s manufacturing sector value added to GDP is around 34%, China 32%, South
Korea 31%, Indonesia 24% and Germany 22%. Make in India initiative is aimed at making India a
manufacturing hub for the world resulting economic transformation while eliminating the
unnecessary laws and regulations, making bureaucratic processes easier, make government more
transparent and receptive, responsive and also accountable and to take manufacturing growth to
10% on a long-term sustainable basis.

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Why Make In India?
Make in India was a timely response to a critical situation. By 2013, the much-hyped emerging
markets bubble had burst, and India’s growth rate had fallen to its lowest level in a decade. The
promise of the BRICS Nations (Brazil, Russia, India, China and South Africa) had faded, and India
was tagged as one of the so-called ‘Fragile Five’. Global investors debated whether the world’s
largest democracy was a risk or an opportunity. India’s 1.2 billion citizens questioned whether India
was too big to succeed or too big to fail. India was on the brink of severe economic failure,
desperately in need of a big push.
Other reasons for the same are as follows:
• Increase in job opportunities, innovation and skill development
• Growth in GDP and Economy
• Attract More Foreign Direct Investment (FDI)
• Investment In India
• Strengthening of Domestic industry

Sectors covered under Make in India

The main focus of Make in India Campaign is mainly on 25 sectors. Almost every sector is capital
intensive and demands a lot of skill. So, with the more and more investment in these sectors, the
main focus will be on increasing employment and the use of advanced technology. These sectors
are
          
 1. Automobiles
 2. Auto components
 3. Aviation
 4. Biotechnology
 5. Chemicals
 6. Construction
 7. Defense manufacturing
 8. Electrical machinery
 9. Electronic system design and manufacturing
 10. Food processing
 11. IT and BPM
 12. Leather
 13. Media and entertainment
 14. Mining
 15. Oil and gas
 16. Pharmaceuticals
 17. Ports
 18. Railways
 19. Renewable energy
 20. Roads and highways
 21. Space
 22. Textiles
 23. Thermal power
 24. Tourism & Hospitality
 25. Wellness

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FOUR PILLARS OF MAKE IN INDIA
Manufacturing in India is the main vision of the government and leads to national development. The
initiative is built on four pillars which are as follows:
New Processes: The government is introducing several reforms to create possibilities for getting
FDI and foster business partnerships. This reform is also aligned with parameters of World Bank’s
Ease of Doing Business index to improve India’s ranking on it. Make in India recognizes ease of
doing business as the single most important factor to promote entrepreneurship. A number of
initiatives have already been undertaken to ease business environment.
New Infrastructure: The government intends to develop industrial corridors and build smart cities,
create world class infrastructure with state of the art technology and high speed communication.
Innovation and research activities are supported by a fast paced registration system and improved
infrastructure for IPR registrations. Along with the development of infrastructure, the training for
the skilled workforce for the sectors is also being implemented.
New Sectors: This campaign has identified 25 sectors to promote with the detailed information
being shared through an interactive web portal. The government has allowed 100% FDI in Railway
and removed restrictions in Construction. It has also increased the FDI to 100% in Defense and
Pharmaceutical.
New Mindset: This initiative intends to change by bringing a paradigm shift in the way Government
interacts with various industries. It will focus on acting as a partner in the economic development of
the country along with development in corporate sector.

(pmindia.gov.in, n.d.)

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Policies and Initiatives undertaken by the Government of India
Foreign Direct Investments:

The investment climate of the country has improved considerably since the LPG policies of1991.
This is largely attributed to ease in FDI norms across sectors of the economy. To attract and
promote FDI, the Indian government has put in place a policy framework, which is transparent,
predictable and easily comprehensible.
India received record FDI of US$ 223 bn during 2014-18. Sectors such as Services, Computer
software & hardware, Telecommunications, Trading, Construction attracted the highest FDI.

There are 2 routes permitted under FDI in the country : Automatic route (does not require any
approval from GoI) and Government route (approval form the GoI is required prior to investment).
Different sectors are covered under different routes:

100% AUTOMATIC ROUTE

Agriculture & Animal Husbandry, Air-Transport Services (non-scheduled and other services under
civil aviation sector), Airports, Asset Reconstruction Companies, Auto-components, Automobiles,
Biotechnology (Greenfield), Broadcast Content Services, Broadcasting Carriage Services, Capital
Goods, Cash & Carry Wholesale Trading, Chemicals, Coal & Lignite, Construction Development,
Construction of Hospitals, Credit Information Companies, Duty Free Shops, E-commerce
Activities, Electronic Systems, Food Processing, Gems & Jewellery, Healthcare, Industrial Parks,
IT & BPM, Leather, Manufacturing, Mining & Exploration of metals & non-metal ores, Other
Financial Services, Services under Civil Aviation Services such as Maintenance & Repair
Organizations, Petroleum & Natural gas,

UPTO 100% AUTOMATIC ROUTE

Infrastructure Company in the Securities Market - 49%
Insurance - upto 49%
Medical Devices - upto 100%
Pension - 49%
Petroleum Refining (By PSUs) – 49%
Power Exchanges – 49%

UPTO 100% FDI PERMITTED UNDER GOVERNMENT ROUTE

Banking & Public sector – 20%
Broadcasting Content Services – 49%
Core Investment Company – 100%
Food Products Retail Trading – 100%
Mining & Minerals separations of titanium bearing minerals and ores, Its value addition and
integrated activities – 100%
Multi-Brand Retail Trading – 51%
Print Media (publications/ printing of scientific and technical magazines/ specialty journals
periodicals and facsimile edition of foreign newspapers) – 100%
Print Media (publishing of newspaper, periodicals and Indian editions of foreign magazines dealing
with news & current affairs) – 26%
Satellite (Establishment and operations) – 100%

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UPTO 100% FDI PERMITTED UNDER AUTOMATIC & GOVERNMENT
Airport transport services (scheduled air transport services, regional air transport services) – upto
49% (auto) + above 49% (Govt.)
Banking (Private sector) – upto 49% (auto) + above 49% (Govt)
Biotechnology (brownfield) – upto 74% (auto) + above 74% (Govt)
Defence – upto 49% (auto) + above 49% (Govt)
Healthcare (Brownfield) – upto 74% (auto) + above 74% (Govt)
Pharmaceuticals (Brownfield) – upto 74% (auto) + above 74% (Govt)
Private Security Agencies – upto 74% (auto) + above 74% (Govt)
Telecom Services – upto 49% (auto) + above 49% (Govt)

(Makeinindia.com, n.d.)

NEW INITIATIVES BY GOI INCLUDE:

New Infrastructure
- Industrial Corridors and 21 new nodal Industrial Cities to be developed
- Doubling of Network of Roads by 2020 and Construction of 15,000 km new roads by 2017 is
targeted under various projects
- Modernising and better connectivity of Indian Railways.
- Sagar Mala project is started by the Govt. of India to modernize India's Ports and Inland
waterways
- The Smart Cities Mission

NEW DESIGN, INNOVATION AND R&D

Other govt initiatives which supplement the make in India campaign include:
-
D

igital India
- Startup India
- Skill India
- Smart Cities
- ATAL MISSION FOR REJUVENATION AND URBAN TRANSFORMATION
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IMPACT ON THE INDIAN ECONOMY

• The main focus of Make in India Campaign is mainly on 25 sectors. Almost every sector
is capital-intensive and demands a lot of skill. So, with the more and more investment in
these sectors, the main focus will be on increasing employment and the use of advanced
technology. These sectors are Automobiles, Automobile Components, Aviation
Biotechnology, Chemicals, Construction, Defence, Manufacturing Electronic Systems,
Electrical Machinery, Food Processing, IT and BPM, Leather Media and Entertainment,
Mining Oil and Gas, Pharmaceuticals, Ports and Shipping, Railways, Renewable Energy,
Roads and highways, Space and Astronomy, Thermal Power, Textiles and Garments,
Tourism and Hospitality Wellness
• The policies are expected to result in a business environment which gives companies a
cost advantage, seamless operations, responsible & transparent governance, assured
markets (domestic buying guidelines for certain industries) and a low risk investment
opportunity.
• This in turn, is likely to translate into more companies setting up their facilities in India
leading to more jobs, hence increased consumer spending leading to an increased Per
Capita Income.
• Increased Per Capita Income will lead to more demand and hence spruce up economic
activity in the country.
• lack of Funds/ availability of cheap credit:
- Amending the SARFAESI Act to facilitate the lending activity,
- Establishing the MUDRA bank and Pradhan Mantri MUDRA Yojana which facilitates
loans to MSMEs
- Credit Guarantee Scheme for SMEs

• Easing the FDI norms and opening more sectors to FDI

• Insolvency and Bankruptcy Code 2016
• Ease of Doing Business
- Improved business processes and procedures
- Incorporation of a company reduced to 1 day instead of 10 days
- Power connection provided within a mandated time frame of 15 days instead of 180 days
- No. of documents for exports and imports reduced from 11 to 3
- Validity of industrial license extended to 7 years from 3 years
- Bankruptcy Code 2015 – New bankruptcy law, providing for simple and time-bound
insolvency process to be operational by 2017
- Goods and Services Tax – Single tax framework by April, 2017
- Permanent Residency Status for foreign investors for 10 years

• Improving Infrastructure and removing bottlenecks

- Developing Industrial corridors
- enhancing the roads and railways capacity
- Smart Cities
- Sagar Mala Project for port led development

• New IPR policy in 2016 which is TRIPS compliant.

• Moves to make Mumbai and Ahmedabad the Arbitration hubs
• New Manufacturing Policy which focuses on simplification on regulatory environment,
usage of green technology and practice and focuses on SMEs and Skill development.

12
 • All the actions/measures/Policies of the government that are aimed at improving business
environment & make India a manufacturing hub.
• The main thing is that the focus is on the manufacturing sector, and the population of
India is majorly middle-class or lower middle-class. So, the products manufactured by the
foreign companies will be entirely for the upper section of the society. Hence, it is
possible that the goals and aspirations of Make in India may not find much success. Make
in India initiative is an honest attempt to revive the fortunes of Industry / Manufacturing
sector. Revival of Industry sector is key to revival of Indian economy. Digital India will
help to maintain contribution of Service sector but manufacturing / industry sector has to
grow at much faster pace to out-pace service sector
(Sahoo)

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Social Impact of Make in India -
The make in India campaign mainly focuses on the manufacturing sector of India, this is because
there is a lot of scope of employment, growth, and this sector also gives a lot of contribution to the
economy.
This initiative was mainly taken to make India the global manufacturing hub. This campaign would
have a lot of benefits like the waiting period of clearance for manufacturing products would reduce
and the ease of doing business in India would also increase.
There are a list of social impacts that were brought out due to the make in India campaign.
1. We can make use of all the resources to the best possible extent
2. People would be more interested in starting their own business in Indian rather than any
other country
3. Exports of the country would increase
4. Foreign exchange reserves would increase
5. India would be in a better position in the international market
6. It would encourage healthy competition amongst youngsters
These are all the social impacts that are be positively affected by the make in India campaign.
(Aheja)

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GLOBAL RESPONSE
Response of MNCs to Make in India campaign:
Encouraged by the initiatives and the incentives announced by the government of India, the
following Indian companies and MNCs expressed their desire to set up their next production
unit or at least enhance the capacity of the existing ones in India.
1) Xiomi, OnePlus, Micromax, Acer, Lava and Spice Group have started their mobile
production units in India. Sony, Gionee and Foxconn have started the production of their
electronic devices such as TVs, handsets, etc. in India. Maruti Suzuki cars will be imported
from the manufacturing units located in India. Volkswagen and Tata JLR have made capital
investments and are producing their cars in India.
2) General Electric has signed a deal with Indian Railways to supply 1000 Locomotives and
hence setting up factory and maintenance yards at an investment of USD 200 million.
3) 10 MSME Samsung Technical Schools will be established in India by Samsung. Huawei
opened a new research and development (R and D) campus in Bengaluru and Invested 170

million to establish research and development centre.

15
Challenges faced in Make in India:
 1. Political agenda – Time after time, the working or the parliamentary affairs are interrupted
and there are delays in the approval of important bills in the parliament houses which leads
to a political gridlock. Due to this the investors and the economy gets confused. There are
critical economic reforms that are required for the implementation of Make in India
campaign that still requires approval from the Indian parliament. Investors who are attracted
by the conditions of Make in India might get tired of waiting and lose interest in the process.
2. Role of Indian States – The Make in Indian initiative was taken for the whole of India. The
political leaders should have a positive lookout at this initiative. Many now-NDA states are
hesitating in the implementation of the same. In contrast to this, many of the NDA led states
have implemented the concept in their own way like ‘Make in Madhya Pradesh’. Therefore,
to make the concept of Make in India a success, all the states should be in sync with the
campaign being for the entire India and not only their particular states and that is how we
can achieve a national progress.
3. Better Infrastructure – For any new, long-term project there needs to be proper equipment,
technology, infrastructure for the efficiency of the project. No infrastructure is possible
without acquiring of land. This requires a new, efficient, transparent and equitable land
acquisition law. This is not easily possible due to the political gridlock.
4. Power Supply – There are yet many small towns and villages in India that do not power
supply at all or either very limited throughout the year. This creates in problem in making
Make in India a success and also efficient. In such a case, the government should first look
at this issue and then broaden the Make in India project to these small towns and villages.
5. Direct competition from China: China has been a hub for manufacturing for years and is
giving direct competition to India when it comes to an option of setting up manufacturing
units. Today China is having an edge over India as its offering better infrastructure and
conducive atmosphere for manufacturing.
6. Global Economic slowdown: Today, the world economy is slowing down, hence, export
oriented strategy would not be very lucrative to be taken up as part of Make In India
scheme.

(Singh)

16
ANALYSIS
 7. Gross Domestic Product: There is a high degree of positive correlation between FDI and
GDP as seen above. This happens because a strong GDP indicates that the economy as a
whole is in a good condition and has a large market to cater to (hence the large production)
which attracts foreign investors towards the economy, leading to an increase in the FDI
8. Trade Openness: There is a low correlation between FDI and Trade Openness. This is
primarily due to the effect of two opposing forces. One school of thought propagates that
companies or investors view FDI as a substitute to importing so more FDI will result in
lesser openness and so on. On the other hand, some economists also believe that Trade
Openness make a market more familiar to foreign investors hence attracting more
investment. The low degree of correlation is largely due to the net effect of these two factors
9. Exports: There is a high correlation between FDI and Exports which is due to the fact that
as exports increase, a nation’s goods become better known in the market and hence act as a
pull factor for the investors
10. Imports: The high degree of correlation between FDI and imports arises mainly due to the
fact that high level of imports show a greater demand and scope for expansion via domestic
production in the economy, hence attracting foreign investors

With a high degree of correlation between FDI and GDP, it's a statistical proof that increasing FDI
is acting as a catalyst for improving GDP figures of the country, thus the country must aim at
procuring more and more investment proposals. The key focus of make in India initiative is to work
on this aspect government has been successful to a great extent in terms of positioning India as a
global manufacturing hub not only on the basis of slogans and propaganda, but on the basis of the
small steps taken in every sphere of the economy.

(Bhatia)

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2. Export
RECOMMENDATIONS

- Simplification and rationalization of taxation system with long term stability is the need of the
hour. A well designed final GST bill, will have the important consequence of creating a truly
national market for goods and services, which will be critical for our growth in years to come.
- Labour laws should be amended in a way that does not overlook the interest of labour.
Progressive labour laws to create more jobs in the market.
- Revisit the Land Acquisition Act, a robust land acquisition policy which eases the process of
acquisition is essential for Investment in Infrastructure and Manufacturing. Infrastructure is the
need of the hour for our country.
- Overall re-hauling of transport system through increasing the capacity of railways, highways and
expressways. Making public transport readily available and safe is an important step in this
direction.
- Physically linking every corner of the country to domestic and international markets through
roads, railways, ports and airports.
- Digitization of all the government departments to improve the ease of doing business. This also
increases transparency and efficiency.
- Strengthening the corporate R&D activity in the country to further the international
competitiveness of national enterprises. A stimulus in the direction of R&D must be provided by
the government. India should work towards attracting greater FDI into Research and
Development.
- Development and an increase in the number of industrial corridors should take place to facilitate
ease of doing business.
- MSMEs scale should be increased manifold in terms of financials and manpower so that more
companies come under MSMEs
- Increased access to finance for MSMEs to reduce the delays and stalling of business projects due
to non- availability of finance.
- Developing energy infrastructure with up-gradation of technology and strengthening of high
capacity national transmission grid.
- Linking everyone electronically and financially to the broader system through mobiles,
broadband, and intermediaries such as business correspondents.
- Encouraging the development of public institutions such as markets, warehouses, regulators,
information aggregators and disseminators, etc.
- More focus should be given on Green field investments than Brownfield investments by the
manufacturers.
- Due to the global economic slowdown and competition from China we should focus on creating
domestic markets and boost domestic demands.
- The business environment must be made more investor friendly by incentivising the
manufacturers and easing the process of FDI.
- We should have more focus on manufacturing goods in such a way that they carry zero defects
and goods with zero effect on the environment.
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CONCLUSION
Ranked among the top 10 attractive destinations for investments from all over the world, India has
proved itself as one of the fastest growing economies of the world. It has now become a
professional license for investors to approach and endow in the escalation legend of India. "Make in
India" is a new push on manufacturing by the new Indian Prime Minister, Narendra Modi. Since
1991, the regulatory environment in terms of foreign investment has been consistently eased to
make it investor-friendly. The measures taken by the Government are directed to open new sectors
for foreign direct investment, increase the sectoral limit of existing sectors and simplifying other
conditions of the FDI policy. FDI policy reforms are meant to provide ease of doing business and
accelerate the pace of foreign investment in the country. Over all scenario of make in India and FDI
was a positive summon to prospective investors from all over the world. It represents a wide-
ranging refurbish of processes and policies. Earlier, Indian Government was working with a
mindset of an issuing authority, but now with the launch of Make in India, it has started working as
a Business Partner. Today, India’s credibility is stronger than ever. There is visible momentum,
energy and optimism. Make in India is opening investment doors. Multiple enterprises are adopting
its mantra. The world’s largest democracy is well on its way to becoming the world’s most
powerful economy.

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Singh, M. S. (n.d.). Make In India : Scope and Challenges ahead .
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Sagar, Make in India- an analytical review.
Mishra , Role of Make in India as driver of growth in manufacturing sector.
National sample survey organisation

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