Finetuning industrial nodes

On August 28, the Cabinet approved a proposal to create 12 greenfield industrial nodes/cities along the backbone of the Golden Quadrilateral.

- SHISHIR GUPTA & RISHITA SACHDEVA

These cities span 10 states, aiming for balanced regional development to make India a global manufacturing powerhouse. It's promising that the government is prioritising a few cities to create agglomerations while recognising the role of large firms as anchor investors.

Agglomerations bring entrepreneurs, labour and capital to a geographically concentrated location, creating competition, resulting in faster growth. According to some estimates, China's per capita gross domestic product (GDP) would have been about 20 per cent lower in a more dispersed growth paradigm. Large firms move with their supply chains, comprising micro, small and medium enterprises (MSMEs), creating ecosystems of economic activity and employment. For example, consider the Tata group's impact in Jamshedpur or the role of Mahindra & Mahindra, Bajaj Auto, and Hero Honda in the automotive hubs of Udham Singh Nagar and Haridwar.

While the intent is correct, the design of the programme requires refinement - specifically, the rejuvenation of existing industrial cities rather than the development of greenfield hubs, as well as recognising the central role states play in creating productive agglomerations.