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The department of heavy industry has constituted a joint task force with the Confederation of Indian Industry (CII) for a comprehensive national capital goods policy to realise the potential of this sector under the Prime Minister's Make in India project.
The task force will take up issues faced by the industry with to evolve a roadmap for the sector, comprising textile machinery, machine tools, electrical and power equipment, plastic machinery, construction equipment, process plant equipment and dies, moulds and press tools.
The initial framework for the policy, to be formulated by the next few months, has been articulated in a paper published by the ministry.
The paper outlines key strategic pillars for the Indian capital goods sector. The areas of focus include creation of an enabling system, expansion of market, promotion of exports, development of human resources, enhancement of technology and intellectual property rights, standards, focus on small and medium enterprises, and building necessary support services.
Sub-sector specific strategies have also been formulated for giving special direction and focus.
These strategies include elements such as access to capital, trade remedial measures, taxation, customs duties, preferential trading arrangements, World Trade Organization issues, attracting foreign direct investment, technological upgradation, safety and environmental awareness.
With a market size of $92 billion and production valued at $32 billion, the sector currently contributes to 12 per cent of India's manufacturing output. The vision of the proposed policy is to increase the share of capital goods contribution from the present level to 20 per cent by 2022 and establish India amongst the major capital goods producing nations in the world.
On the export front, India's share in global exports from the sector is currently quite low at 0.1-0.6 per cent across various sub-sectors. In contrast, in countries such as China, Germany, Japan, and South Korea, this range is 7-16 per cent depending on the sub-sector.
