Big infrastructure push to make investing simpler

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Illustration: Naorem Ashish

AFTER HIGHWAYS, special economic zones and ultra mega power projects, large manufacturing hubs are envisaged as the next big thing. Currently, the sector accounts for over 15 percent of the country’s gross domestic product (GDP).

The idea is to attract bulk foreign and domestic investments and facilitate timely approvals and clearances. Says Minister of Commerce and Industry Anand Sharma: “Though our current share in global exports is just 1 percent, manufacturing will be the key employment generator in times to come, with nearly 12 million joining the workforce every year.”

“The key is to have a well-established infrastructure and regulatory mechanism,” according to Arvind Mahajan, executive director at global consulting firm KPMG. On an average, a manufacturer in India needs to comply with some 70 laws, each requiring clearance. Asked whether India had the capability of becoming a global hub, Vinayak Chatterjee, chairman of the Confederation of Indian Industry’s National Council for Infrastructure, said he was confident it could, after seeing the performance of the automobile and auto ancillary, pharmaceuticals, textiles and garment manufacturing sectors.

The stats available with the Federation of Indian Chambers of Commerce and Industry certainly indicate that there is enough demand. For example, India imports mobile phones worth more than $3 billion annually and around $450 million worth of air-conditioners land on Indian shores.

The proposed hubs will be a combination of manufacturing facilities for both domestic and export production, as also house production units, logistics parks, environment protection mechanisms and support services.

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