In a volatile macroeconomic environment, economists speak in rave terms about how India could be an outlier to the recessionary fears. From the IMF forecasting robust growth for India in 2023 to financial giants like Moody’s and Morgan Stanley endorsing India’s economic power and trusting it to become the third-largest global economy by 2027, 2021-2030 looks like India’s decade to leave its mark on the world.
Considering India’s manufacturing capability, as called out by the commerce and industry ministry in their India @ 2047 umbrella goals, we can capture 10% of the global trade, and I believe we will certainly surpass that target if the current optimism sustains in the long run. This optimism is justified by the fact that India’s manufacturing prowess is pegged on domestic consumption alone.
Catalysing our growth is the growing global distrust against China in the post-pandemic world. On the other hand, the EU as a whole is descending into hyperinflation as geopolitical tensions erode the finances of large economies.
The manufacturing springboard
Today, India is the sixth-largest manufacturer globally and boasts a workforce that is over 50 crore strong. Our strength comes from our young demographic, effectively ensuring that the country will seamlessly transition into a manufacturing powerhouse in the near future. Bolstering our manufacturing prowess is the combined power of our developed states like Gujarat and Maharashtra. The latter pulled in FDI inflows of $58.7 billion in FY22, accounting for 26% of the cumulative inflows into India. Other states will soon reinforce their capabilities once we enable and empower the bottom of the pyramid and the workforce with the necessary skill set, infrastructure, and support.
Turning challenges into opportunities
First and foremost, the Indian manufacturing industry needs to strengthen its ecosystem to deliver exceptional solutions with a good turnaround time and global quality, which in turn will augment India’s prominence on the global stage. India’s private sector will have to increase its investment in infra-capex, and bigger players will have to take incremental steps towards delivering world-class, end-to-end solutions. We should be proud of the tremendous progress we have made, but we should maintain our focus on digitising processes, upskilling our people, and sustaining operational efficiencies to produce reliable solutions.
We need to encourage the government to continue investing in infrastructure and bring in better policies and regulatory mandates to help achieve our dream of being a manufacturing powerhouse. We must strive to collaborate with them to support local sourcing and eventually create a supply chain ecosystem that leaves no man or material behind.
The road ahead
In any goal worth achieving, there are bound to be roadblocks. However, with better regulatory support, entrepreneurial vision, and skilled labour we can overcome them in our bid to become a manufacturing powerhouse.
Our central government has been the wind in the sails of the manufacturing sector given its aggressive focus on expanding Capex and bolstering infrastructure spanning roads, railways, ports, and airports. It is at this very juncture that the private and public sectors must leverage opportunities to capitalise on indigenous know-how and technical skills and move ahead strategically while cutting back on foreign dependency. The need of the hour is for each one of us to listen to the clarion call of our country’s golden hour and be instrumental in advancing India on the global stage.
