'Make in India'. This is the development slogan with which Prime Minister Narendra Modi is aiming to revive the Indian economy and make the country a global manufacturing hub. The share of the manufacturing sector to India gross domestic product (GDP) currently stands around 15. His government aims to take this to 25% of GDP in the coming years. While this is indeed a noble vision, it is not at all going to be easy.
Here are some facts that should worry Indian policymakers:
As per an article in Livemint, Tata Steel shut down its largest iron-ore mine on account of delays in permits. State-run steel maker Steel Authority of India Ltd (SAIL) too has pulled down the shutter on its top-yielding quarries owing to pending renewal of it lease. Another steel player JSW Steel Ltd's plan to commence mining operations in Jharkhand have been impacted by a probe into the mine allocation process. Given that iron-ore and steel are the critical inputs in most manufacturing industries, the supply of these basic materials can be a major hindrance to 'Make in India'.
These instances are not exceptions but point to India's unending and unyielding bureaucracy. It is no wonder that India's slipped down two positions to 142 out of 189 economies in the World Bank's latest 'ease of doing business' rankings. Regulatory and bureaucratic hurdles continue to impede investments and economic activity in the country. Unless these are resolved, India's dream to become a global manufacturing hub may not manifest.