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Make in India completes 8 years of groundbreaking reforms on 25 September 2022, initiative & reforms

Make in India, the flagship program of the Government of India, which seeks to facilitate investment, promote innovation, develop skills and build best-in-class manufacturing infrastructure, completes 8 years of groundbreaking reforms on 25 September 2022. Launched in 2014 under the dynamic leadership of Hon’ble Prime Minister Shri Narendra Modi, ‘Make in India’ is transforming the country into a world-leading manufacturing and investment destination. This initiative is an open invitation to potential investors and partners worldwide to participate in the growth story of the “New India”.

Make In India has achieved significant achievements in 27 sectors. This also includes strategic sectors of production and services. To attract foreign investment, the Government of India has introduced a liberal and transparent policy in which most sectors are opened to FDI automatically. FDI inflows to India reached US$ 45.15 billion in 2014-2015 and since then it has achieved record FDI inflows for eight years. 2021-22 saw an all-time high of foreign direct investment of $83.6 billion. These FDIs come from 101 countries and have invested in 31 UTs and states and 57 sectors in the country.

On the back of economic reforms and ease of doing business in recent years, India is on track to attract USD 100 billion in FDI in the current fiscal year. The Production Linked Incentive (PLI) program across 14 key manufacturing sectors was launched in 2020-21 as a major boost to the Make in India initiative. The PLI program stimulates domestic production in strategic growth sectors where India has a comparative advantage. This includes strengthening domestic manufacturing, creating resilient supply chains, increasing the competitiveness of Indian industry and increasing export potential.

The PLI scheme is expected to generate significant gains for manufacturing and employment, with benefits extending to the MSME ecosystem. Recognizing the importance of semiconductors in the global economy, the Indian government has launched a USD 10 billion incentive program to build a semiconductor, imaging and design ecosystem in India.

To strengthen the Make in India initiative, the Government of India has taken several other measures :

•The reform measures include changes in laws, liberalization of directives and regulations to reduce unnecessary compliance burden, reduce costs and ease of doing business in India.

•Simplification, rationalization, decriminalization and digitization have reduced the burdensome compliance of rules and regulations, making it easier to do business in India.

•In addition, Labor reforms introduced flexibility in hiring and firing. Quality control orders have been introduced to ensure quality in local production.

• Steps to support manufacturing and investment also include corporate tax cuts, public procurement and a phased-in program.

•In order to support local industries by giving them priority in the procurement of goods, works and services, the Public Procurement (Preference for Manufacturing in India) Order, 2017 has also been issued under rule 153 (iii) of the General Financial Rules, 2017 , which enables the provision.

The objective of this policy is to encourage domestic manufacturers to participate in public procurement activities as opposed to entities that only import goods for trade or assembly. The Policy applies to all Departments or Ministries or attached or subordinate authorities or autonomous bodies governed by the Government of India and includes Government Companies as defined in the Companies Act.

The National Single Window System launched

Further, the National Single Window System (NSWS) was launched in September 2021 to facilitate ease of doing business by providing investors with a single digital platform for approval and screening. This portal has integrated several existing approval systems of various Ministries/Departments of the Government of India and State Governments to enhance the investor experience.

The government has also launched a multi-modal connectivity program to the country’s manufacturing zones, called the Prime Minister’s Gatishakti programme, which will ensure logistical efficiency in business operations through the creation of infrastructure that will improve connectivity. This will enable faster movement of goods and people, improve access to markets, nodes and opportunities and reduce logistics costs.

The One-District-One-Product (ODOP) initiative is another manifestation of the ‘Make in India’ vision to facilitate the promotion and manufacture of indigenous products from every district of the country and provide a global platform to artisans and handloom manufacturers. , handicrafts, textiles, agricultural and processed products, thereby further contributing to the socio-economic growth of various regions of the country.

The toy industry in India:

Prime Minister Shri Narendra Modi during his Mann ki Baat broadcast in August 2020 expressed his desire to establish India as a global toy manufacturing hub and strengthen domestic design and manufacturing capabilities. The toy industry in India has historically been dependent on imports. Lack of raw materials, technology, design skills, etc. led to huge imports of toys and their parts. In 2018-19, toys worth USD 371 million (2960 cr) were imported into our country. Much of these toys were unsafe, substandard, counterfeit, and cheap.

The government has taken several strategic interventions to deal with the importation of substandard and unsafe toys and to improve the domestic production of toys. Some of the key initiatives include increase in basic duty rate from 20% to 60%, implementation of Quality Control Order, mandatory sample testing of imported toys, grant of more than 850 BIS licenses to domestic toy manufacturers, development of toy clusters etc. Several promotional initiatives including India Toy Fair 2021 , Toycathon 2021 and Toy Business League 2022 were organized to promote domestic toys to encourage innovation and new design to meet global demands.

Accompanied by the sincere efforts of domestic toy manufacturers, the growth of the Indian toy industry has been remarkable in less than 2 years despite the Covid-19 pandemic. Toy imports declined by 70% to USD 110 million (877.8 cr) in FY21-22. There has also been a significant improvement in the quality of toys on the domestic market. At the same time, industry efforts led to $326 mn (Rs. 2,601.5 cr) toy exports in FY21-22, up over 61% from $202 mn (Rs. 1,612 cr) in FY18-19 . India’s toy exports registered a whopping 636% growth in April-August 2022 over the same period in 2013.

There are several trends that represent a shift in Indian manufacturing, which include increasing domestic value addition and local sourcing, greater focus on research and development, innovation and sustainability measures. The Make in India initiative seeks to ensure that the country’s business ecosystem is conducive to investors doing business in India and contributes to the nation’s growth and development. This was achieved through a series of reforms that led to increased investment inflows and economic growth. With this initiative at the fore, businesses in India aim to ensure that products that are ‘Made in India’ are also ‘Made for the World’ and adhere to global quality standards.

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