8 Months agoAfter 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.
WHAT IS ‘MAKE IN INDIA’?
Make in India Initiative was launched globally in September, 2014 as a part of the Government of India’s renewed focus on invigorating the country’s manufacturing sector. The Make in India initiative has made a tremendous impact on the investment climate of the country as shown by significant growth of 46% in Foreign Direct Investment (FDI) equity inflows and highest ever FDI inflows at US$ 55.5 billion in 2015-16. After 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 to grow above 7% till 2020 as per International Monitory Fund (IMF).
In the last two years, the government has drastically improved the business climate of the country, pushing it towards the trajectory for high and sustainable growth. From a call-to-action to becoming a platform for national development, ‘Make in India’ has made its presence felt across the globe.
WHAT HAS BEEN THE JOURNEY FOR MAKE IN INDIA?
Here are some of the key milestones:
- September 2014
The Department of Industrial Policies and Promotion (DIPP) of the Ministry of Commerce and Industry took up a series of measures to improve the Ease of Doing Business to simplify some of the existing rules.1
- January 2015
Spice Group announced an investment of US$ 75.16 million to set up a manufacturing unit for budget smartphones in Uttar Pradesh.2
- February 2015
Chinese technology company Huawei made a huge investment of US$ 170 million to set up a new Research and Development (R&D) campus in Bengaluru. The campus, sprawled across an area of 20 acres, can accommodate 5,000 engineers.3
- March 2015
Magneti Marelli, Fiat’s component manufacturing arm, started operations for manufacturing of Electronic Fuel Injection (EFI) in a joint venture with leading two-wheeler maker Hero MotoCorp in Manesar.
- May 2015
Hyundai Heavy Industries partnered with Hindustan Shipyard Limited, Visakhapatnam to help build naval ships in India, this collaboration would help India's shipbuilding industry to leap forward tremendously.4
Daimler India Commercial Vehicles Pvt. Ltd. (DICV), a 100% wholly owned subsidiary of Daimler AG, Stuttgart, Germany, announced the inauguration of its new bus manufacturing facility in Oragadam, Tamil Nadu and unveiled its second wave of products – BharatBenz and Mercedes-Benz buses as well as a new range of new BharatBenz high-power engine trucks and BharatBenz heavy-duty tractors.
India moved 13 positions ahead from 65th to 52nd rank in Tourism and Travel Competitive Index as per the World Economic Forum (Davos) Report.5
- June 2015
French aircraft manufacturing company LH Aviation signed a Memorandum of Understanding (MoU) with Indian OIS Advanced Technologies (OIS-AT) for manufacturing of tactical drones in India.6
India rose to 1st position in the Baseline Profitability Index in 2015. India was ranked at the 6th position in Baseline profitability index in 2014.7
- July 2015
In the Global Startup Ecosystem Rankings 2015 Bengaluru moved to #15 in 2015 from #19 in 2012 (this was driven by the second highest growth rate in exit volumes and VC investment among the Top 20).8
Mercedes Benz India inaugurated its second manufacturing facility in Chakan , which shall double the plant capacity to 20,000 units per annum. The total investment in the manufacturing facility now stands over US$ 148 million since inception.
- August 2015
Taiwan’s Foxconn, the world’s largest contract electronics manufacturer and a key supplier to Apple Inc., signed a pact with Maharashtra to invest US$ 5 billion over five years in a semiconductor manufacturing facility.9
The electronics manufacturing sector received a further boost, with Lenovo and Motorola announcing their plans to manufacture smartphones in India in a 40,000 square feet factory in Sriperumbudur near Chennai. The facility currently can create 6 million smartphone units per year.10
Xiaomi launched local manufacturing in Visakhapatnam in August 2015 under the Make in India program. The plant exclusively assembles Xiaomi phones and is Xiaomi's second manufacturing unit outside China.
- September 2015
“Make in India Mittelstand initiative” was launched in partnership with Indian embassy in Berlin, Germany for providing Market Entry Support Services like strategic consulting, tax & legal support, project financing, technology collaboration and facilitation of approvals to German Mittelstand organizations.
Japanese electronics giant Sony got on to the ‘Make in India’ bandwagon. After nearly a decade, the company is getting back to manufacturing in India, with plans confirmed for two models of its television brand Bravia.11
World’s largest internet based retailer Amazon opened a warehouse in Pune in September 2015 taking the total count to over 21 with a cumulative storage capacity of over 5 million cubic feet.
- October 2015
India moved up 12 places and reached 130th position in "Ease of Doing Business 2016" report, (World Bank).12
India moved up one position to become the world's seventh most valued 'nation brand', with an increase of 32 per cent in its brand value to $2.1 billion in 2015. It was the 8th most valued nation in the world in 2014 and ranked 9th in 2013.13
- November 2015
India attracted over US$ 18 billion worth of investments since September 2014 from companies viewing the country as a potential electronics manufacturing powerhouse. Some of the major ones including Samsung, Bosch, Phillips, LG and Flextronics have shown a keen interest in creating their manufacturing bases here.14
International Tractors Ltd. (Sonalika) invested US$ 75 million for setting up its new Hoshiarpur plant in Punjab with the capacity to manufacture 0.2 million tractors per annum. The plant would contain a single production line for all variants and models and an engine assembly line for 500 engines/day.
- December 2015
General Electric Transport and Alstom won contracts worth a combined US$ 5.6 billion to supply India’s railways with new locomotives. These foreign companies will help improve the vast but old state-owned network.15
Following Japanese PM Shinzo Abe’s visit to India, Japan announced setting up a US$ 12 billion fund for ‘Make in India’ related projects. This investment will be in the name of ‘Japan-India Make in India Special Finance Facility’ that will also strengthen the relationship between the countries.16
- February 2015
The multi-sectoral Make in India Week (MIIW), a mega event held in Mumbai, was a platform to showcase nation's focus towards design, innovation and sustainability. MIIW was a resounding success which was attended by over 0.9 million visitors from 102 countries and over 8000 B2B/B2G/G2G meetings was conducted over the course of the week.17
- March 2016
India achieved its highest ever FDI inflow for a financial year in 2015-16 at US$ 55.5 billion
Japanese technology giant Hitachi announced its plans to roll out ATMs in India - one of Asia's largest ATM markets - with the investment capital of US$ 15 million.18
- April 2016
US chipmaker Qualcomm plans to establish an innovation lab in Bangalore to provide technical and engineering assistance to the selected companies. It has launched ‘Design in India’ initiative with the aim to mentor up to 10 Indian hardware companies who have the potential to come up with innovative solutions.19
India moved up to sixth position amongst the world’s leading manufacturers. India has jumped by three positions from ninth position in the previous report. The growth rate of Manufacturing Value Added (MVA) of India was 5.5 % in 2014 and 7.6 % in 2015.20
- May 2016
India’s Gross Domestic Product (GDP) growth rate for quarter January-March stood at 7.9 per cent as against 7.3% in October – December, thereby making it the fastest growing major economy in the world.21
- June 2016
In a sweeping overhaul of FDI norms, the government radically liberalised key sectors like defence manufacturing, civil aviation, pharmaceutical and food processing, making India as one of the ‘most open economy’ in the world.22
India jumped 13 positions and was placed second in retail potential in the 2016 Global Retail Development Index (GRDI). India was rated 15 in the 2015 Global Retail Development Index.23
- July 2016
Actual work on the ground has started on 25% of investments commitments signed during the Make in India week.24
- August 2016
India jumped 15 spots to reach 66th position in Global Innovation Index 2016. India was ranked 81 in 2015.25
India improved its performance on Logistics Performance Index by 19 positions when compared with its ranking in 2014. India’s ranking has jumped from 54 in 2014 to 35 in 2016.26
- September 2016
India jumped 16 places to the 39th rank in 2016 from last year’s 55th position in the Global Competitiveness Index, highest jump of any country for this year. In 2014 India was in 71st position as per GCI 2014. India has thus jumped 32 positions in two years.27
- October 2016
Schneider Electric is preparing to make India its export hub on the back of government’s policies such as Make in India, Digital India and Smart City Mission.28 Schneider Electric have 28 factories, R&D centers and further plans to invest around US$ 110 million in the coming five years and will keep investing in skill development.29
The World Bank’s annual Doing Business 2017 report placed India in 130th position, recognizing India’s achievements in implementing reforms in four of its ten indicators – Trading across Borders, Getting Electricity, Enforcing Contracts and Paying Taxes. Additionally, India’s Distance to Frontier score improved on 6 out of the 10 indicators, showing that India is increasingly progressing towards best practice.
Make in India has now become a calling card for investors to come and invest in the Indian growth story. To further the Indian manufacturing capabilities, the government is focusing on the development of sectors that are going to be the key focus in the coming years. By introduction of new reforms in policies along with a positive economic atmosphere, it has created a fertile ground for businesses to thrive in India.
7 Foreign Policy Magazine, http://chart.fpdatawrapper.com/wzXtv/index.html
13 Brand Finance, http://brandfinance.com/images/upload/nation_brands_2015_for_print.pdf
20 International Yearbook of Industrial Statistics - UNIDO
25 Cornell University, INSEAD and the World Intellectual Property Organization (WIPO), http://www.wipo.int/edocs/pubdocs/en/wipo_pub_gii_2016.pdf