India: a potential powerhouse

June 26, 2014 4:59 am

India has a huge potential to become a global manufacturing hub, purely driven by demand in the country. The current scenario clearly shows that manufacturing sector constitutes 13-14 per cent of the GDP
For past few years, there has been a talk and numerous attempts of connecting the words like ‘superpower’ or ‘global hub’ with India. Is India really having that in it to become the same? If yes, then why this dreaming or aiming phase of becoming global manufacturing hub is getting elongated? Neeraj Bhatia shares his views with OEM Update on India’s capacity and probable chances of becoming a global workshop.
A potential powerhouseIndia has a huge potential to become a global manufacturing hub, purely driven by demand in the country. The current scenario clearly shows that manufacturing sector constitutes 13-14 per cent of the GDP. On the other hand, services sector is found forming bigger pie. Demographics are also in India’s favour and in addition, talent pool is not at all concern for India.  Well, what is putting India back in becoming the same is nothing but the productive infrastructure. Obviously, a rapid development of infrastructure is imperative at this stage. Quality roads, highways, airports, and housing are essential to aim high in manufacturing sector.
Need of investmentInvestments always encourage the proceedings. They not only support but also express a strong faith in ability of the concerned projects. Therefore, proper investments are required in critical areas such as health, education, manpower, and skill development. In automobile sector, a visible change in terms of OEM’s investment is clearly being witnessed. Some leading players like Maruti Suzuki, Ford, Isuzu are investing in expanding capacity to cater to local demand. They are using cost competitiveness of India to make it an export hub. Similar types of investments are needed in above mentioned areas also to ensure a bright future in sector.
Stimulating factorsBy far the most important factor to stimulate India’s manufacturing growth is to make it more attractive for the world to source from. India is certainly having a significant advantage with a huge domestic consumption base. Ideally this should offer all the opportunity to create scale benefits. However, how it gets utilised matters a lot.
Roadblocks But hold on, surely there are some roadblocks the Indian manufacturing sector is facing today. These include lack of technology innovation, conducive macro-economic environment and of course, productive investments. However, thinking positively, these are the areas if we can improve in, India will excel in future. Improvement in these factors will definitely help in encouraging the economical and overall growth of country.
Expected role of govtConsidering the present situation, Indian manufacturing sector expects some favourable and good moves from new government. Faster decision making on policies and stabilising the macro-environment for productive investments are some of the issues that the government should consider addressing with utmost priority.
Roadmap for Shell IndiaIndia has a strong and huge domestic market which holds long term promise. Shell India assures that it would continue to bring the latest high technology products to support and continuously meet the rapidly changing consumer needs.
Neeraj Bhatia, Senior VP, Business Development, Shell India Markets Pvt. Ltd.