India’s fast growing entrepreneurial system is heavily skewed towards sectors other than manufacturing. In a group of 50 budding entrepreneurs, not more than 5 would say that they want to start a factory. It’s mainly dot-com, data analytics or something in IT. In a country like India, it somewhat makes sense to prioritize on sectors other than manufacturing. It is mainly because of the perceived notion of fast growth and easy scalability in e-commerce as against heavy capital requirement, long gestation period and government challenges in case of manufacturing.
Being from a manufacturing background, I firmly believe opportunities in Manufacturing are being neglected by our entrepreneurs. Although this sector is capital intensive, there is huge scope for sustainable attractive returns. PM Modi has probably recognized this lacuna after assuming power and hence his ‘Make in India’ campaign flagged off in Sep 2014. According to research papers and news articles, Manufacturing represents 16% of India’s GDP, compared to 43% in China. India’s growth in recent years has been principally driven by rapid expansion in services. The government target is to reverse the relative decline of manufacturing and to restore it to 25% of the GDP by 2025, creating ample job opportunities.
Make in India is a great initiative. However, can it not be ‘Think in India’ with the kind of talent that we have in India and abroad? It is up to us to decide whether we want to be the next USA to the world which has given the most innovative products or the next China to the world which is a mass manufacturing hub or in fact create a niche for ourselves. Dr. APJ Abdul Kalam in his book Ignited minds published back in 2002 truly believed India had the potential to be a developed economy by the year 2020. Although I completely respect and admire the entrepreneurial ecosystem, can we actually look at innovation and new ideas rather than copying the west? We have been very good at value addition in the existing product offering and adapting it for India. We definitely have the potential to go from ‘Jugaad to Jhakaas’ provided we get the right support and if the seeds of Innovation are ingrained in the DNA right from our days in school.