Dethrone Manufacturing Powerhouses

With a push from trade volatility, interventions and private investment, India is poised to become one of the global manufacturing powerhouses. Ashish Bhatia with Deepti Thore looks at recent efforts that need to be multiplied manifold to realise this aspiration.

- Deepti Thore Ashish Bhatia

India is at a crossroads! With its attractive propositions including land and cheap labour, the country has always received a healthy inflow of Foreign Direct Investment (FDI) barring exceptional years. Global manufacturers preferring to set up their export hubs and technical CoEs with huge sums ploughed into the country are a testimony to the favorable cost-benefit analysis. To become a hub for global manufacturing, however, the task is cut out - India must up its quality benchmarks and technological advancements before turning into a net exporter. The think tanks expect the country to play a significant role in reshaping supply chains despite some eyebrow-raising big-ticket exits recorded from the country in recent times. It is estimated that the country could contribute more than USD 500 billion as an annual economic impact to the global economy by 2030. PM Narendra Modi, in 2019, shared the vision of India turning into a five trillion economy by 2023-24. Notably, the automotive components industry contributes 7.1 per cent of the Gross Domestic Product (GDP) in FY21 and 49 per cent of the manufacturing GDP besides generating employment for 50 lakh people. By 2026, the industry alone could grow to a USD 200 bn valuation.

Pronounced opportunity