India Proposes The First Manufacturing Policy To Enhance Growth Rate

India has formulated the first national manufacturing policy.

The government of India indicated that the core of the policy included the establishment of National Investment and Manufacturing Zones (NIMZs), large industrial parks, or "industrial towns" that conform to the labor and investment regulations.

But the policy also hopes to improve India's industrial infrastructure, simplify business norms, develop new green technologies, and enhance the skills of new generation of manpower.

As for individual units or regions, no subsidy is provided because industrial parks will be built by private sector.

But there are also some financial incentives, including the purchase of plant buildings in the park and the purchase of machines which are exempt from capital gains tax.

B Muthuraman, President of Confederation of Indian Industry (CII), said that simplifying administrative procedures and having world-class infrastructure facilities will greatly encourage the manufacturing sector to increase investment in India.

India is a young country with a working age of over 60%. It is estimated that the new labour force will be increased by 220 million in the next 10 years. The manufacturing industry is the key industry that can provide at least 50% jobs for the new labour force.

At present, about 16% of India's gross domestic product is contributed by the manufacturing sector, which has also led to its domestic worries about the rapid growth of other Asian countries.

The textile and clothing industry in India accounts for 4% of GDP, 14% of industrial production and 12% of foreign exchange earnings. It is the second largest employment market after agriculture, with 33 million direct workers and 55 million non direct workers. 7 million of them are related to garment manufacturing and half of them are engaged in export.