The Make in India movement

What Make in India is

Jobs and skills, spread over 25 sectors of the economy, are what Make in India was set up to deliver. Its means is manufacturing: the Government of India asks companies to make their products on Indian soil, and it addresses that call to multinational firms as much as to Indian ones. The initiative dates from 25 September 2014.

The initiative did not start from nothing. India opened its economy in 1991, and the reforms it accepted that year had three strands: globalisation, which tied the Indian economy to the world's, together with stabilisation and restructuring at home. Make in India carries that opening further. On trade, the gain looked for is a steady, sustainable balance between what India sells abroad and what it buys, and the government expects this from Make in India working together with its companion programmes, Skill India and Digital India.

Its four pillars

The Ministry of Commerce and Industry describes the movement as resting on four pillars.

• A new mindset. Working alongside industry on the country's development, the government casts itself as an enabler that helps firms get things done, not a watchdog that regulates them.
• New sectors. Foreign investors can now enter many more fields: railway infrastructure and construction, medical devices and insurance (where the FDI rules were also relaxed), and even defence production.
• New processes. A start-up and a long-established company alike should find it simple to set up and operate. The initiative made this ease of doing business a key lever for encouraging entrepreneurs, and took steps to improve the climate for both kinds of firm.
• New infrastructure. Infrastructure here covers people and ideas as well as buildings. Industry's skill needs were mapped so that workers could be trained to meet them; inventors and researchers gained from simpler registration and stronger intellectual property systems; and on the physical side the plan was industrial corridors and smart cities equipped with modern technology and fast communications.

Why it matters for Indian business

A manufacturer choosing where to build looks first at the market, and India's pull there is strong. International investors already rank it high on their list, its economy is growing quicker than most, and a young population whose incomes and savings are rising should sustain growth for decades. Make in India adds to that pull in three ways. Starting and running a unit becomes easier in a friendlier climate; partners and technology can come in through sectors now far more open to foreign investment; and training workers for the skills industry needs is meant to make hiring easier.

Picture a small Pune firm that makes parts for medical devices. Wider FDI in that sector lets it form a joint venture with a foreign maker, while quicker registration and a nearby skilling centre let it expand its plant and hire trained technicians.

An assessment

Make in India is less a single scheme than a change of direction: the state acting as partner, more sectors open to investment, easier procedures and a push for better infrastructure. Its success rests on whether these steps actually turn into factories and jobs; that is the test of its stated aims of employment and skill.