Next in the series of solved WAT topics for final admission round 2015 at IIMs and other top rated B schools, MBAUniverse.com shares below the essay on Is “Make in India” a realistic project with China far ahead in manufacturing?
What’s Make in India: Introduce the topic
With a vision and mission to put Indian Economy on the wheel of high growth, Indian Prime Minister Narendra Modi’s Government launched the “Make in India” campaign to attract businesses from around the world to invest and manufacture in India. The aim of the campaign is to make India a global hub for the manufacturing of goods ranging from cars to software, satellites to submarines, paper to power and a lot more.
A realistic Project
The “Make in India” project is a realistic project which aims to increase the contribution of manufacturing in GDP to 25% from 16% as of now. India has already marked its presence as one of the fastest growing economies of the world. India is having the favourable demographic dividends for the next 2-3 decades and the cost of the manpower is less as compared to the other developed countries.
India is a house of strong and responsible business houses operating with credibility and professionalism. These business houses have big contribution into the development of the Indian economy. Besides it India has a strong consumer market and is going to expand in the coming years. The strong technical and engineering capabilities backed by top-notch scientific and technical institutes are an added advantage to boost this campaign.
India to give tough fight to China
Comparing the “Make in India” campaign with China which is far ahead in manufacturing, it is projected that India is going to give a straight fight to China in the manufacturing sector. The labour cost in China is increasing continuously and this may lead to the increased cost of the goods manufactured. This will open a way to India to increase the manufacturing capabilities to serve the cheap manufactured goods to world.
China is unlikely to lose its dominant position as the 'factory of the world' in near future because of its well-established infrastructure, existing manufacturing facilities, ability to scale quickly, and strong involvement in established global supply chains. On the contrary India is still struggling with poor infrastructure which is a major deterrent for the foreign investment.
RBI Governor Raghuram Rajan made statement that world cannot accommodate two Chinas but cannot stop India from becoming a successful exporter. China exports 12 per cent of the World’s merchandise while India is having less than 2 per cent. But given its massive labour force and considerably lower wages, India can snatch another two percentage points from China in the next five years. That alone could give a huge boost to the 'Make in India’ for the global economy' campaign.
India was way ahead of China
It will be surprising to note that till 1978 China remained a closed door economy and way behind India. China marched on the path of steep economic growth only after it opened its doors to world market. Indian Economy that has been on the path of consistent growth couldn’t take off well as it focused on exporting more of raw material and less of finished goods. In the process it not only began losing its prominence among exporting countries but also had to pay more for the finished goods made of its own exported raw material at very low rates.
India can become a manufacturing hub only if its exports grow and not just by producing for domestic consumption. Since “Make in India” is focused on attracting the foreign investors to set up their units in India, manufacture here and export to rest of the world “Make in India” is going to be realistic upto certain extent but it will take time to surpass the growth of China which is far ahead in manufacturing.
Conclusion: ‘Make in India’ will awaken India
In conclusion, India is the 3rd largest growing economy of the world. However there are some shortcomings like infrastructure, roads, electricity that are deferring the foreign investors to invest in India but there is also an immense pool of opportunities with cheap labour and abundant resources in India. The export led manufacturing is definitely going to raise the economy of India and will benefit the country by exploring more job opportunities. The “Make in India” campaign is a strong campaign that favours the growth of India if continued on the right track with the strong and transparent system.
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