The government on Tuesday said it will announce the new ‘future-ready’ Industrial Policy in October, by suitably incorporating measures to facilitate the use of modern smart technologies such as Internet of Things, artificial intelligence and robotics for advanced manufacturing. The new policy will aim at making India a manufacturing hub by promoting ‘Make in India’, an official statement said, adding that the new Policy will subsume the National Manufacturing Policy.
In this regard, Commerce and Industry Minister Nirmala Sitharaman will hold consultations in Chennai, Guwahati and Mumbai with stakeholders, including industry captains, think tanks and State governments, it added.
The Department of Industrial Policy and Promotion (DIPP) – the nodal body for the new Policy and part of the commerce and industry ministry — has put out a discussion paper on the new Policy and has sought comments, feedback, suggestions from the public by September 25.
The discussion paper said the “illustrative outcomes” of the policy include increasing the number of global-Indian firms to those in the Fortune-500 category in the long-term, and in the medium-term helping attract $100 billion inward FDI annually and support outward FDI to assert Indian presence in world markets, and addressing the problem of low job creation in the formal sector.
The other “illustrative outcomes” are developing alternatives to banks and improving access to capital for MSMEs through ‘Peer to Peer Lending’ and ‘Crowd funding’, providing a credit rating mechanism for MSMEs to provide them easier access to funds, addressing the problem of inverted-duty structure and also balancing it against obligations under multilateral or bilateral trade agreements, studying the impact of automation on jobs and employment, ensuring minimal/zero waste from industrial activities and targeting certain sectors to radically cut emissions.
A consultative approach has been taken wherein six thematic focus groups — Manufacturing and MSME; Technology and Innovation; Ease of Doing Business; Infrastructure, Investment, Trade and Fiscal policy; and Skills and employability for the future — and an online survey on the DIPP website are being used to obtain inputs, the official statement said.
Focus groups, with members from government departments, industry associations, academia, and think tanks have been set up to delve deep into challenges faced by the industry in specific areas. Besides, a Task Force on Artificial Intelligence for India’s Economic Transformation has also been constituted which will provide inputs for the policy, the statement said. Since the last Industrial Policy announced in 1991, India has transformed into one of the fastest growing economies in the world and is now equipped to deploy a different set of ideas and strategies to build a globally competitive Indian industry, it added.
The discussion paper said the constraints to industrial growth include inadequate infrastructure, restrictive labour laws, complicated business environment, slow technology adoption, low productivity, challenges for trade including the Indian MSME sector facing tough competition from cheap imports from China and FTA countries, inadequate expenditure on R&D and Innovation. These constraints work in tandem to increase cost of goods and services, it said. “As they are strongly entwined, they exacerbate the disadvantages. The nexus needs to be broken at more than one link to ensure that the spin-off is in the positive direction,” the paper added.