'Make in India' vs 'Made in China' Campaign

Introduction
On 25 September, at the eve of his departure for USA, PM Narendra Modi unveiled the Brochure and
the Logo for the Make in India campaign, in the capital, at the Vigyaan Bhawan.
The campaign aims to turn India into a global manufacturing centre. About 3,000 top global
companies are being targeted in this ambitious campaign.
This initiative is directed towards facilitating, setting up and running businesses with greater ease and
to draw foreign investors to India with an overall aim of providing an impetus to the beleaguered
manufacturing sector and generation of employment opportunities in India.
Sectors Covered Under the Programme
The programme lays emphasis on promoting 25 sectors. The programme would facilitate skill
development and hence, quality job creation.
The sectors covered under the programme include: automobiles, chemicals, IT, pharmaceuticals,
textiles, ports, aviation, leather, tourism and hospitality, wellness, railways, auto components, design
manufacturing, renewable energy, mining, bio-technology, pharmaceuticals and electronics among
others.
Highlights of Vision for Manufacturing Sector

An increase in manufacturing sector growth to 12-14% per annum over the

medium term.

An increase in the share of manufacturing in the countrys Gross Domestic

Product from 16% to 25% by 2022. While, manufacturing sector contributes is
in the range of 25% to 30% in countries like China, Thailand and Malaysia.

To create 100 million additional jobs by 2022 in manufacturing sector. PM

Modi recommends handing over Industrial Training Institutes (ITIs) to the
Industry to enhance trade specific training and generation of quality
employment.

Creation of appropriate skill sets among rural migrants and the urban poor for
inclusive growth. National Skills Development Centre will play a decisive role in
identification and imparting training of skill sets required.

Providing heightened domestic value addition and technological depth in

manufacturing to ensure high end products that are competitive in the world
market are manufactured and also are affordable. .

Inspire self reliance and competiveness for sustainable growth, especially, of

the national manufacturing units.
Plans for Making Business Easier

New de-licensing and deregulation measures: Process of applying for

Industrial License & Industrial Entrepreneur Memorandum made online on
247 basis through eBiz portal.

Validity of Industrial license extended to three years.

Empowering States by decentralising authority to introduce self-certification

and third party certification to avoid delays and red tapism in the name of
scrutiny.

Major components of Defence products list excluded from industrial licensing

to encourage and speed up indigenisation of weapon/equipment components.

In order to encourage private parties to invest and assist in early procurement

in dual use items having military as well as civilian applications, the items have
been deregulated.

Services of all Central Govt. Departments & Ministries will be integrated with
the E-Biz a single window IT platform for services by 31 Dec. 2014. This
would provide regular updates and prompt information about the policies and
procedures.

Process of obtaining environmental clearances made online to save time and

curb politically motivated tendency to create an issue out of it, as is usually
found to be done.

Advisories sent to all Departments/ State Governments to simplify and

rationalize regulatory environment. Presently, the entrepreneurs are harassed
to the limit of exiting their planned venture.

All returns should be filed on-line through a unified form, to prevent

subsequent manipulation and malpractices.

A check-list of required compliances would be placed on

Ministrys/Departments web portal for the ease of preparing the requisite
paperwork.

All registers required to be maintained by the business should be replaced with

a single electronic register to cut down excessive documentation to be
maintained by the entrepreneur.

No inspection to be undertaken without the approval of the Head of the

Department to avoid harassment and arm twisting by government
departments.

States given the liberty, for all non-risk, non-hazardous businesses, a system
of self-certification could be introduced.
Imperatives for Effective Implementation of Programme

Effectively implementing the idea of laying the Red Carpet instead of the
Red Tapes as was pronounced by PM Modi.

Deregulation of processes and decentralisation of authority to speed up results

on the ground.

It is unlikely that foreign companies will share the technology, otherwise they
will lose monopoly and hence India must cater to huge investments in R&D to
upgrade own manufacturing sector, so as to stand in competitive comparison
to the foreign products being manufactured in India.

The workforce required to be employed in the industries identified in the

programme must be trained concurrently to facilitate the success of the
programme.

Stricter regulations for import of mass consumption commodities like food,

consumer goods, electrical products and light engineering goods on quality
clearances to compel such brands to manufacture in India for consumption in
India.

Manufacturing clusters need to be created with proper habitat for the workforce
and all basic amenities must be catered for in these ecosystems, like, labour
markets, liveable spaces, and access to markets, etc.

Retrospect taxation, or Tax Terrorism as it is being called by foreign

companies, e.g. in the case of Vodafone and some other service providers
creates a sense of mistrust in the mind of investors. The taxation policies must
be clear, concise, binding and standardised.

Invariably, entrepreneurs use the tax benefit region for packaging and shipping
of their goods and then wait for the next region to be granted the benefit for
planning their investment. Hence, the methodology adopted for such
concessions must encourage more and more entrepreneurs to set up
businesses.

Goods and Services Tax (GST) must be implemented earliest to create a

better investment climate.
Chinas Made in China Campaign
Chinas Made in China campaign coincided with Indias global launch of Make in India campaign.
Chinas intention appears to be, that it wants to send a message to the world that China will continue

to hold technological edge over India in the manufacturing sector. The highpoints of Chinas campaign
are as follows:

China will encourage high-tech imports for research and development (R&D)
to upgrade its manufacturing sector.

China will use tax breaks to encourage enterprises to upgrade their equipment
and increase R&D efforts to improve the manufacturing industry.

Companies that bought new R&D equipment and facilities after January 1 or
possess minor fixed assets will have taxes reduced based on value.

Imported high-tech equipment will also enjoy tax deductions in aviation, biomedicine production, manufacturing of railway and ships, electronics
production including computer and telecommunications, instrument production
and those used in making IT products and software.