 "Amitabh Kant")
The Union Government is planning to project the country's business potential, even as global economies struggle to grow. The Make-In-India week will showcase manufacturing power and the the government hopes the event will attract fresh investments from overseas. In an interview with Sanjay Jog, DIPP secretary Amitabh Kant explains why the event is the need of the hour. Excerpts:
Given the falling business sentiments around the world, how important do you think the Make-In-India initiative is to attract investments?
This is the time for India to demonstrate its ability in manufacturing and increase its share further in global manufacturing. India is currently the only economy which is growing at the rate of 7.4 per cent and is accelerating. There has been increase in demand within the country. Besides, there is every potential to expand manufacturing. India is the only large economy that is expected to grow further in next two to three decades.
In this backdrop, manufacturing is quite important and there is no other option but to go in for manufacturing full scale to help create new jobs. India had lagged in the past for the type of scale but all that has changed now.
The Government recently imposed import duties on steel. Do you think it will help the Make-In-India initiative?
We are in a globalized world and India is an integral part of the supply chain. Due to cheap imports, there has been severe impact across sectors including manufacturing. There will be long term implications. Steel is the backbone of the industry in India and if it collapses every other sector will collapse. Steel is core industry.
China has created huge excess capacity and is dumping steel across the world. Every single country including the United States has imposed import duty. In case of India, it is a special case and a temporary measure. We want to ensure that Indian steel industry grows.
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I am a strong believer that India must become a cost competitive nation and competes with the world.
The India urban cities require massive investment in infrastructure; do you think Make-In-India will help attract investments in this segment?
Urbanization and manufacturing are directly correlated and there is a huge convergence. There is an integration of manufacturing and urbanization. Large-scale manufacturing creates jobs. In next three decades we will have 500 million people living in urban areas. According to a Mckinsey study, India will have 700 million urban population by 2050 . Therefore, the challenge is to do sustainable and innovative urbanization. This can happen if we do large scale quality manufacturing as it will create jobs and people will shift from agriculture to manufacturing. Shift to manufacturing is a logical consequence.
Urbanization must be done on a sustainable and innovative manner. Focus needs to be given on recycling of water, improvement in public transportation, proper utilization of wastage.
Mumbai is the host city for the event and there were several reports by committees to make Mumbai as an international financial centre (IFC). Do you think that will ever become a reality?
To become an international finance centre, we first need a financial sector reforms. Besides, India needs a long term debt market, a derivative market. Only when we have financial sector reforms, Mumbai, which is country's financial capital will become IFC. However, there is an urgent need to improve quality of infrastructure in Mumbai.
With Indian banks now grappling with very high NPAs, how will businesses fund the Make-In-India initiatives?
There is an upsurge of foreign direct investment to India by 48 per cent. The private sector has invested but few companies in certain areas have been overstressed. Banks have provided debt to them. There is need to clean that act, capitalize the banks and need to make them function professionally and that is what the government is aiming for.
Are States geared up to play crucial role in Make In India?
There is huge competition among various states. They are competing on 340 points in Make In India initiative. During the Make In India week, chief ministers from 17 states are coming. Every state is competing for progress. In my view, States must become the champion of growth.
