Make in India: Strengthening the Supply side of Indian Economy

Abstract

Manufacturing sector has always been considered to be an engine for economic growth of any nation. One of the main reasons for slow economic growth in India is the structural imbalances in the economy. Indian economy has been traditionally an agriculture based economy. In Indian economy, majority of the population i.e. around 54% is engaged in agriculture sector, but the share of this sector in GDP is around 15%, a clear indicator of very low productivity. The share of manufacturing sector in GDP is below 18% whereas total employment engaged in manufacturing activities is around 20% of the total employment. It is also observed that Indian manufacturing sector could not grow as expected due to higher input costs e.g. effect of indirect taxes on selling price, high cost of power, water, transportation & finance, poor quality of product and lack of competitiveness of its exports. To boost up the growth of our manufacturing sector, Government of India has initiated "Make in India" programme with an objective to encourage domestic and foreign companies to manufacture their products in India. This theoretical research paper is an attempt to study the salient features of "Make in India" programme and to analyze the issues and challenges in its implementation. For the purpose of this study, only secondary data has been collected