Today cities like Pune, Chennai, Manesar have been recognised by German, Swiss and Korean companies as suitable industrial hubs. By having such more places, conducive environment should be created to set up manufacturing plants.
Being one of the world leaders in developing new bearing technology, SKF has developed understanding of rotating equipment and how machine components and industrial processes are interrelated. Today SKF provides a range of technologies and products to OEM and aftermarket customers around the world, in every major industry, at each phase of the asset lifecycle. Shishir Joshipura shares his views on India’s present and probable future position in world manufacturing sector.
Leverage on the strategic advantageIn order to develop a strong manufacturing base it is important for the country to leverage on the strategic advantage it has to offer compared to other manufacturing destinations in the world. The advantage India has to offer is skilled and English speaking manpower and a large domestic market. Pivotal factors for success in manufacturing industry are productivity and cost-effectiveness. Competence of the available talent should be raised to increase the productivity. Cost-effectiveness on the other hand is linked with increasing efficiency and bringing innovation in the system.
Having fresh graduates and engineers with a lot of potential, all we need to do is guide them and channelise their energies through vocational and skill enhancement training. One of India’s biggest strength is the fact that English is the business language and that opens up numerous possibilities of interaction at global level as more and more MNCs are setting up manufacturing hubs in India.
Today cities like Pune, Chennai, Manesar have been recognised by German, Swiss and Korean companies as suitable industrial hubs. By having such more places, conducive environment should be created to set up manufacturing plants. Once these things are done, automatically the difference could be observed in approach towards FDI business environment as well. This will also lead to development of industrial cities and create more employment opportunities.
Moreover, policy environment should become favourable for manufacturing. Though India is often perceived as the fastest growing economy by many industry experts, some flexible and transparent laws are needed.
Decisive factorsThere are some factors which could be decisive in the growth of Indian manufacturing sector. As manufacturing industry contributes substantially to India’s GDP, it should be one of the important agendas to promote economic growth in the country. Further, laws which are in sync with land and labour should be reformed to create the conducive working environment and lure foreign investors to invest. It will in turn create employment opportunities in the country.
The manufacturing ecosystem is developing and evolving in India. There are automotive, engineering, and ancillaries companies which demand for industry-ready labour. One of the shifts that have been observed is these companies are upgrading themselves by looking at automation and installing computerised systems. Hence there is a need to upgrade skills for all technicians through vocational and technical training.
An efficient supply chain systems especially in segments like pharma, farm, food and beverages etc. that is backed by logistics and overall infrastructure growth will be critical growth trigger. Also an easy access to funding is required from various sources like private equity, venture capital, bankers.
Current roadblocksOne of the biggest roadblocks faced by manufacturing sector today is the lack of clear policy direction. Other issues are the lack of proper land and labour reforms, skill upgradation and easy access to funding etc. The slow performance of the manufacturing sector has been dependent on domestic demand. The slowdown has hit many segments right from auto to consumer durables. High interest rates and controlled consumer spending are some of the disturbing factors. The other critical aspects like slow decision making by the government and land acquisition issues have put projects on hold as well.
Expectations from govt.To boost manufacturing sector’s growth, the government has already proposed setting up mega zones in different parts of the country. In addition, the national manufacturing policy aims at increasing contribution of manufacturing to the national GDP from current 16 per cent to 25 per cent by 2025 and creating 100 million jobs in the next decade.
However, the government should look at methodologies where it can make India an easier place to do business. Some of the measures can be by simplifying procedures, eliminating bureaucratic hurdles, and creating a more transparent and clearer taxation regime.
For the manufacturing industry to grow and contribute 25 per cent to the GDP, the government has to address the issues of FDI in manufacturing and design stable policies with immediate effect.
SKF approachSKF’s aim is to provide and develop cutting edge solutions for its customers. The company wants to create a sustainable advantage and bring more value to its customers and lead the industrial manufacturing sector growth in India.
Shishir Joshipura, Managing Director and Country Head, SKF India.