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Make in India: Status and Scope

Make in India: Status and Scope


Make in India initiative was launched on September 25, 2014, by incumbent Prime Minister of India. The initiative was sought as a major move to boost manufacturing sector of India and in turn generate new opportunities of employment. Since then, the initiative and its impact has been much talked about and tracked.

Let’s have a brief look on its scope and current status.  

Objective of the Initiative

The initiative aims to raise the contribution of the manufacturing sector to 25% of the Gross Domestic Product (GDP) by the year 2025. It is being led by the Department of Industrial Policy and Promotion.

The major goals of the scheme are listed below:

  • Make India a global manufacturing hub
  • Encourage multinational as well as domestic companies to manufacture their products within the country
  • Promote foreign direct investment
  • Facilitate innovation and skill development
  • Facilitate job creation
  • Sustainable development i.e. Development without environmental degradation

The scheme targets 25 sectors of the economy which includes from automobile, to Information Technology (IT) etc.

Where do we stand?

India is ranked 54 out of 144 countries in Economic Complexity Index (ECI), which ranks a country on the basis of how diversified and complex a country’s manufacturing export basket is. It means India is not into the production of goods which require high technical acumen and face scarce competition.

Currently, manufacturing is about 17% of the country’s GDP. As per the government data, the year 2015-16 witnessed 46% growth in Foreign Direct Investment (FDI) equity inflows and highest ever FDI inflows at $ 55.5 billion. Also the government website quotes International Monetary Fund statistics according to which, post the launch of Make in India initiative, India has emerged as the fastest growing major economy with GDP growth rate above 7.6% in 2015-16 and projected growth rate above 7% till 2020.

To attain our vision of accelerating manufacturing growth, we need to develop capabilities in core products and also develop ourselves for large scale production of other products.


Making India a manufacturing hub requires focus on various factors as stated below:

  • Land
  • Labor
  • Electricity
  • Technology
  • Transport
  • Cost of capital and borrowing etc.

While the land and labor laws of the country are complex and primitive, a major part of the country faces challenges like power shortage and bad connectivity. High tax rates and skill requirement in technology also act as deterrents to build profitable businesses.

To attract and retain investments in this sector, core problems like this needs to be fixed first to portray us as a competitive and lucrative manufacturing hub.

Summing Up

Though the make in India initiative has not made remarkable achievements till now, yet its role in creating a conducive business environment in the country cannot be ruled out.

First demonetization (leading to less demand) and then GST (causing regulation related confusion) has acted as short term setback to the country’s manufacturing sector. However, the initiative can realize its true potential with focused policy approach and private–public partnership, more investment in skill development and R&D and focus on labor and skill based projects.