BEFORE leaving for the US, Prime Minister Narendra Modi unveiled the ‘Make in India’ campaign to turn India into a manufacturing hub. It is an invitation to domestic and foreign companies as it is a promise to remove everything that has put the country at the bottom of the World Bank’s ‘ease of doing business’ index. The Prime Minister said that his government’s mantra was to trust every Indian who could change a lot of things. The programme came with a new web portal emblazoned with the logo of a lion. It encourages foreign companies to invest in India and is aimed at relaxing rules, cutting all kinds of red tape and removing hurdles to investment. Modi wants dedicated teams to guide and assist first time-investors from the time of their arrival. As part of the big plan, foreign investment caps in construction are to be lowered for greater participations in 100 smart cities.
The government wants to hike the share of manufacturing in India’s GDP from 15% to 25%. From energy shortages and land problems to ambiguous tax laws as well as antiquated labour rules, a whole host of hurdles have kept large scale private investments away. India should attract investors as a massive, attractive market. Lack of cooperation between the Centre and the state governments also puts investors off. Accordingly, the states will have to reform laws, even at the level of local bodies and must implement plans and policies formulated by the Centre. All this should help Narendra Modi keep his key election promise to lift lowest living standards among emerging markets by creating jobs for about one hundred million young Indians. The government has identified 25 sectors for potential investments and plans to introduce a single labour law for small industries. It is expected that the Prime Minister’s interactions in Japan and the expectations from his US visit will create a positive environment.
