New Delhi: India will soon have a national policy on manufacturing that will help create 100 million additional jobs and boost the sector’s GDP share to 25 percent by 2025. Industry associations have termed its as “one of the most important policy initiatives in recent times”.
“Creating livelihoods for millions of people in the working age group is important from the point of view of inclusive growth and the new manufacturing policy would enable just that,” Chandrajit Banerjee, director general of the Confederation of Indian Industry (CII), said .
He said the government’s decision to come out with a national policy on manufacturing was one of the most important policy initiatives in India in recent times.
“For the first time, we are going to have a policy dedicated to the manufacturing sector. Industry welcomes the in-principle nod given by the prime minister to the draft national manufacturing policy and hopes that a final policy will be announced within a month,” said Harsh Mariwala, president of Federation of Indian Chambers of Commerce and Industry (FICCI).
A high-level committee on manufacturing headed by Prime Minister Manmohan Singh cleared the draft of the policy that aims to increase the share of manufacturing in the country’s GDP to 25 percent by 2025 from the present 16 percent.
The new policy is expected to give a fillip to the growth of industrial and overall GDP, which have slowed lately.
GDP growth slowed to 7.8 percent in the January-March period, the slowest in five quarters.
The country’s industrial output grew at a much slower 6.3 percent in April, according to official data released Friday.
Analysts said the new policy, if implemented quickly, would provide a much-needed fillip to growth, especially the growth of industrial output.
“This will certainly give the much needed boost to the manufacturing sector whose contribution in the country’s GDP has remained stagnant at 16 percent and needs to increase it to generate the much needed employment opportunities,” FICCI’s Mariwala said.
According to draft of the proposed manufacturing policy prepared by the Department of Industrial Policy and Promotion, in consultation with National Manufacturing Competitiveness Council and the Planning Commission, the new policy is estimated to create an additional 100 million jobs by 2025.
The government plans to set up sprawling industrial cities, equipped with production units and public utilities including residential accommodation, schools and hospitals, to boost manufacturing growth in the country.
The industrial towns called national investment and manufacturing zones (NIMZs) would each be spread over an area of nearly 5,000 hectares.
“The NMIZ model based policy would provide the necessary enablers that are required urgently to ensure that India becomes a prominent and competitive base for manufacturing globally,” said CII’s Banerjee.
Sustaining growth and providing gainful employment to the rising workforce is among the biggest challenges facing the country’s economic policy makers.
The draft policy, which was presented to the meeting presided over by the prime minister by Commerce and Industry Minister Anand Sharma, has been prepared after consultations with various stakeholders, including different ministries, state governments and industry associations. (IANS)