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Self-Reliance In Manufacturing Key To Recovery
As India Inc. closely follows Finance Minister Nirmala Sitharaman’s resurrection roadmap for the economy, it brings to the fore the vision of self-reliance laid out by the Prime Minister.
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Today, businesses in the manufacturing space are staring at a demand that has completely vanished — an unprecedented challenge over the last 100 years! Lack of demand and lack of revenue streams impacts cash flows for all organisations. The cash flow impact makes it an even greater challenge for micro, small & medium enterprises (MSME), in particular, until demand picks up again. Global expectation on revival is varied and can be anywhere from a V-shaped or W-shaped to an L-shape recovery.
Regardless of the recovery shape, the silver lining is that the need from human beings has not vanished, but just set to hibernate for a bit. Until recovery begins, it will be difficult for MSMEs to compete in the market if they have no cash. The solid measures announced by the government will facilitate liquidity for MSMEs and help them gear up for a post-Covid recovery phase. At the same time, it will be important that MSMEs use this inflow wisely towards current and future business needs, to help them cater to demand when it picks up and create sustenance and sustainability.
For a self-reliant India, a robust local manufacturing sector can act as a strong lever for economic growth. This will need greater localisation of supply chains and building industrial clusters within the country. A strong push to MSME growth and recovery in the FM’s Rs 20-lakh-crore economic stimulus package, will give a huge impetus to creation of an ecosystem that aids survival and creation of local manufacturing.
With the new definition of MSMEs announced by the government, they can now look forward to sustained growth. Larger MSMEs can play a very strong role in the creation of the ecosystem for manufacturing provided they can maintain a long-term vision.
India has the potential, ingenuity, and ecosystem to enable its vision of one of the most attractive investment destinations efficiently and equitably.
As the government sets into motion the Prime Minister’s vision of a self-reliant India or Atmanirbhar Bharat, embracing ‘technology’ at an increasing pace across all spheres of industry, society, and nation building is a must. Technology and manufacturing go
hand in hand with one creating an uplift for the other, and, in effect, creating a positive spiral. Technology has changed our world; it has changed the way that businesses behave today. A thriving local industry powered by India’s own technology will also provide an apt platform for its skilled and ambitious workforce in manufacturing.
Despite these turbulent times, the recovery and potential rise of India as a major power would require development of all elements of national power to secure the country’s interests and enable us to play a more effective role in the regional and global arena.
By creating large infrastructural programmes, appropriate reforms aimed at improving ease of doing business, building more partnerships for co-creation opportunities, creating a highly skilled talent pool, adopting technology intelligently and moving up the manufacturing value chain, India will be closer to realising its true growth potential successfully. It has to be a value arbitrage that India has to create going forward and not just a cost arbitrage. We envision a new India with greater strategic autonomy and technological far-sightedness to anticipate and respond to the challenges of the future.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.