After 10 years, ‘Make in India’ struggles to enhance manufacturing’s share of GDP
In 2023-24, the manufacturing sector contributed 15.9% to value addition, down from 16.7% of GDP in 2013-14.
The government has acknowledged that it will take time to boost manufacturing, as the sector’s share in GDP remains below the levels seen in 2013-14, despite the Make in India program marking its 10th anniversary.
In 2023-24, the manufacturing sector contributed 15.9% to value addition, down from 16.7% of GDP in 2013-14. The government aims for a 25% manufacturing share in GDP by 2030. DPIIT Secretary Amardeep Singh Bhatia noted that building momentum will take some time.
Bhatia explained that the challenges to increasing manufacturing share in GDP are not only due to investment but also technology. He emphasised that investments should introduce technology, build capacity, and enhance skills to create momentum. The government aims to incorporate technology alongside investments in the Make in India program, which was launched in 2014 to boost manufacturing’s contribution to GDP.
The government has implemented several reform measures under the Make in India program, including the Semicon India Program, which has a budget of ₹76,000 crore to boost semiconductor manufacturing. Additionally, there is a Production-Linked Incentive Scheme covering 14 manufacturing sectors and the National Single Window Programme to streamline approvals from 32 ministries and departments, as well as 29 states and UTs for faster clearances. The PM Gati Shakti National Master Plan utilises data-driven strategies for integrated multimodal infrastructure planning to reduce logistics costs. Lastly, the National Industrial Corridor Development Programme aims to enhance industrial infrastructure.
When asked about India’s manufacturing sector losing to countries like Mexico, Vietnam, and Bangladesh due to higher costs, Bhatia noted that factory gate costs in India are similar to those in these countries. However, India faces higher logistics costs. He emphasised that the PM Gati Shakti scheme aims to reduce these logistics expenses.
Regarding the PLI schemes introduced in 2020, Bhatia stated that there have been investments of ₹1.4 lakh crore, resulting in a manufacturing output of ₹12 lakh crore and the creation of 8.5 lakh jobs. Moreover, firms participating in the scheme have realised exports amounting to ₹4 lakh crore.
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