National Manufacturing Policy: Features and Objectives

National Manufacturing Policy: Features and Objectives

Question - Government has recently launched an e-Biz portal aimed at providing various services of the government via a single portal. The National Manufacturing Policy provides major impetus for economic growth and development. Discuss.

• National Manufacturing Policy has proposed rationalisation and simplification of business regulations.

It has the following aims:

- The share of manufacturing in GDP to rise by 25% in 2022
- Increase in growth of manufacturing sector to 12 to 14 percent across the medium term
- Increase in rate of employment creation in manufacturing for creation of 100 million additional jobs by 2022
- Enhanced global competitiveness of Indian manufacturing through efficient policy support
- Launch of the Make in India programme in 201 with the aim of attracting business to make investments in manufacturing sector in India

• Policy is based on principle of economic and industrial growth in partnership with states

• Central government will create the enabling policy framework providing incentives for infrastructure development on PPP basis through effective financing

• Policy aims at setting up National Investment and Manufacturing Zones using clean energy efficient technology; NIMZ are provided with land area of at least 5000 ha

• Industrial townships are proposed to be self governing and autonomous bodies under the constitution

• Infrastructure will be financed appropriately by Central government through viability gap funding while Special Purpose Vehicle will develop zone infrastructure through PPP mode

• NIMZ will be managed by SPV headed by government officials and experts including that from the environment

• Policy also aims at improving access to finance for SMEs in manufacturing sector
Delhi Mumbai Industrial Corridor/DMIC

• The first phase of NIMZ is carried along the Delhi Mumbai Industrial Corridor which will be anchored in the National Manufacturing Policy

• It will utilise the dedicated railway western Freight Corridor aimed at development of futuristic industrial cities

DMIC project covers the following 6 states:

- Haryana
- UP
- Rajasthan
- MP
- Gujarat
- Maharashtra

• This project accounts for 43% of the national GDP and 50% of industrial production and exports; it also comprises 40% of the total workforce

• Job creation for 3 million persons is another benefit of this project

• DMIC has 24 nodes covering 11 investment regions and 13 industrial areas.

Why India?

• India is expected to rank among the top three growth economies in the world and top three manufacturing destinations by 2020

• Indian manufacturing sector has favourable demographic dividend for the next 20 to 30 years

• Quality workforce is another major advantage of India as a manufacturing destination

• Business houses operate in credible and professional manner

• Country has polity which is democratic and follows rule of law

• India also has strong consumerism and effective intake ability of the domestic market

• Cost of manpower here is very low

• Advanced technical and engineering capabilities alongside top notch scientific and technical institutes is another favourable sign

• There is also a well regulated, stable financial market open to international investors

Facts and Stats

• Government of Japan has announced financial support for DMIC to the tune of USD 4.5 billion during the first phase through lending from:

- Japan International Cooperation Agency(JICA) and
- Japan Bank for International Cooperation(JBIC).

• Master plans have been developed for the following three nodes: Tumkur(Karnataka), Krishnapatnam (Andhra Pradesh) and Ponneri (Tamil Nadu) under the Chennai-Bengaluru Industrial Corridor with the assistance of JICA

• 7 investment nodes are being developed under DMIC as NIMZ:

- Ahmedabad-Dholera Investment Region, Gujarat

- Shendra-Bidkin Industrial Park city near Aurangabad, Maharashtra

- Manesar-Bawal Investment Region, Haryana

- Khushkhera-Bhiwadi-Neemrana Investment Region, Rajasthan

- Pithampur-Dhar-Mhow Investment Region, Madhya Pradesh

- Dadri-Noida-Ghaziabad Investment Region, Uttar Pradesh

- Dighi Port Industrial Area, Maharashtra