Make in India, For the World

Context: Make in India for the world signifies India’s aspiration to be a powerful trading nation on the back of quality products, competitive manufacturing, and integration into the world economy.

Trade Distortions

• Massive subsidies: China uses a combination of massive subsidies and intellectual property theft, to become the dominant producer and exporter of many essential products.

• For solar panels, it used to give an annual subsidy exceeding $15 billion. 
• Local manufacturing in most countries could not compete with cheap imports from China, and this results in a decline in domestic manufacturing. 

• Third country Free Trade Agreement route:  For, E.g. Chinese steel firms based in Indonesia export subsidised steel products to India using the low duty benefit under the India-ASEAN Free Trade Agreement. 

Promoting India’s manufacturing and trade: A 4-Fold Plan

• Reducing input costs: High duties on raw materials, expensive credit, time taking land transactions and less productive labour increase the input cost.
•  Deep reforms in these areas will make India an attractive place to do business.

• Define ‘Make in India for the world’ standards and make it a quality label: 

• Setting up a large number of design studios, innovation labs, and strengthening of standards and quality infrastructure. 

• Making these infrastructures freely accessible to the Micro, Medium and Small Enterprise.

• Expand manufacturing and trade:  

• Making products which the world buys most such as electronics, organic chemicals, machinery, apparel and telecom equipment.
• Becoming a component manufacturing hub:  

• This requires deep expertise for most components for which joint ventures and external investments are needed.
• Need reforms in import duty structure, building efficient ports, and online systems.

• Avoiding critical dependence on any country: India needs to develop self-sufficiency in bulk drugs, power equipment and defence related products 

• Participation of business and technology experts: This will help in transforming our agriculture, manufacturing, technology, logistics, education, and most other sectors.