India Cabinet Approves National Manufacturing Policy
alok agarwal
India Cabinet Approves National Manufacturing Policy
The Union Cabinet has approved the “National Manufacturing Policy” on October 25, 2011 that aims to create 100 million additional jobs by 2025 and develop mega industrial zones with world-class infrastructure facilities and flexible labour and environment regulations.
The Cabinet Committee on Economic Affairs headed by Prime Minister Manmohan Singh approved the policy that also aims to increase the share of manufacturing in the economy to 25% by 2022 from the current around 16%.
According to the policy, the government would help establish National Manufacturing Investment Zones with world-class infrastructure and investment friendly regulations to boost manufacturing activities.
"China has done it, Germany has done it, Japan has done it and now India has decided to do it," Commerce and Industry Minister Anand Sharma said.
View: India’s service sector which has 55% share in GDP employs only 25% of total working population as it absorbs only skilled population. That is why a huge population in India still depends on agriculture. The concerted effort by the government to increase the manufacturing share to GDP to 25% would make a big difference in India's employment story as it can absorbed the unskilled and semi-skilled workers.
On the other hand, India's level of industrialization is very low despite it emerging as one of the top 10 manufacturers of the world. India’s per capita manufactured value added (MVA) - a measure of income generated by the manufacturing sector per person - was one-eighth of China's and one-sixth of Brazil's in 2010, the two other developing countries in the group of top 10, according to Unido (United Nations Industrial Development Organization). This actually reinforces the need to increase the manufacturing sector's contribution to the GDP from16% to 25% over the next 10 years,
So this policy will bring stability into growth as well as into employment. It will not only absorb more employment in future, it will also help India to grow on an equitable manner.
For a detailed report on Manufacturing Policy, issued on March 09, 2011, click on the following link:
Theme Presentation on
NEW MANUFACTURING POLICY
http://www.microsec.in/Static/Pdf/634352939292192000_Manufacturing%20sector%20Theme.pdf
Regards,
Team Microsec Research
