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Six Countries, Six Sectors, One Mission: Make in India

‘Look East, look West’ is India's best go-to-market strategy. Let’s drive concentrated efforts towards top six countries setting the tone for growth.

Photo Credit :

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“There are decades where nothing happens, and there are weeks where decades happen.” – Lenin.

60 days = Rs. 10,000 Cr. If time is money, is this the new normal? 

Yes, time is precious to tap opportunities.  India scaled to a Rs. 10,000 crore PPE market in under 60 days post the Covid-19 pandemic: a combination of entrepreneurship, focus and determination.  

A differentiated execution will determine success for Make in India 2.0 (MII) to fulfil the USD 5 trillion economy vision, with manufacturing expected to deliver USD 1 trillion. Modern economic case studies demonstrating strong co-relation with manufacturing as a pillar include the US, and European & Asian countries.  

Focus is everything; play to win

Is it easy? Certainly not. 

MII’s win depends upon complex inter-plays.  The Govt. of India is committed through policy reforms, EODB improvement and an attractive tax rate for manufacturing. The state governments are developing infrastructure and providing incentives for attracting investments. Well-developed industrial ecosystems offer faster time to market & resilience to new companies. Our MSMEs and entrepreneurs are hungry for success.

When it comes to execution success, it's all about playing to our strengths: 

  1. Leverage existing competencies in Indian industries. This will accelerate our capabilities to get plugged deeper into global supply chains and GVCs.

  2. Choose arenas with geopolitical, economic and business alignment. It will be easier for India to demonstrate value delivered. 

  3. Make investments in priority areas where it will generate disproportionate impact.

We must focus reach-out on priority countries and sectors.  The investment & growth contribution by all countries and sectors is welcome in India. But, very importantly: Focus is everything!

Six Countries

‘Look East, look West’ is India's best go-to-market strategy.  Let’s drive concentrated efforts towards top six countries setting the tone for growth.

  • USA: The world’s leading market contributes almost 23% of global GDP, which equals that of the lowest ranking 173 countries combined!  It is home to deep & very well-developed B2B and consumer markets.  If we want to shift the needle, we must partner with the ‘No. 1’ - no more explanations required!

  • UK: An existing strategic partner to India, Brexit can be another game changer for the UK-India business corridor. UK-based businesses are looking for cost-effective production locations and new markets.  India can be an attractive market as well as a factory for UK. 

  • European Union (EU): As all norms are challenged, let’s take a differentiated approach to another cluster. A common market and collective leverage aspiration can redefine bilateral trade growth. The EU has 3 countries amongst the top countries by GDP (Germany, France, Italy). Additional benefits for Indian companies from EU: technical & business collaboration with EU based companies will move Indian industries further up the value chain.  

  • Japan: Currently the third biggest market and one of India’s most strategic partners, Japan presents enhanced collaboration opportunities.  Its businesses need access to vibrant, growth markets.  An appropriate time to expand horizontal trade between both countries. India has been continuously ranked among the top two countries in potential and investment as per MITI(1) survey. Let’s convert this potential into reality. 

  • South Korea: It has demonstrated excellent industrial growth & capabilities in the last two decades.  South Korean companies present in India have already demonstrated their capabilities to build markets in automobiles, engineering, mobiles, etc. There is a wide spectrum of adjacent possibilities: India must build up on this right away. 

  • Taiwan: A population of just ~24 million, but the world’s 22nd largest economy.  What’s more interesting is that its per capita GDP is even higher than the likes of Canada, UK, Germany, etc. Its export-focussed economy relies heavily on strategic supply chains and foreign production hubs. The recent geopolitical developments will certainly motivate Taiwanese business to diversify their supply chains and India is an ideal production location candidate.

Six Sectors:

These are the top established & emerging sectors where Make in India can make a faster beachhead.

Established Sectors:  

  • Auto & auto components: India is already the world’s largest market for two wheelers, three wheelers & tractors. It has scale and extensive Tier-1 & Tier-2 vendor ecosystems. It’s best suited to further entrench itself into the global supply chains of other OEMs to support new consumer trends & cost-effective innovation. 

  • Electronics/ ESDM: From an importer to now the world’s second largest mobile manufacturer, it has led to extensive vendor & suppliers’ development. The strategic intent to further expand into ESDM(2) space is amply clear now with announcement of 3 schemes (PLI, SPECS and EMC 2.0)(3). A 4-6% cost advantage is a significant one in low margin & high scale manufacturing.

  • Medical Devices & Healthcare: India is the world’s numero uno vaccine supplier and the third largest generic drugs producer, but ranks 14th in value. This is a good opportunity for upward movement in GVCs and to capture significant global market share. A combination of investment in R&D and attracting new medical devices companies for production will enable this path.

Emerging Winners:

  • Handicrafts & Furniture: Despite providing employment to 70 mn people, the Indian handicrafts industry constitutes just 2% of global trade, while the furniture industry’s contribution is ~1%.  Considering post Covid-19 changes including WFH, new consumer demands, redesign of office spaces, etc., India must leverage its rich heritage in crafts to customize at scale for exponential market share. 

  • FMCG & Food Processing: India’s FMCG market is expected to be amongst the top 5 markets by 2030. Leading MNCs & Indian companies like HUL, P&G, Nestle, ITC, Dabur, Marico, etc. are catering to aspiring lifestyles and consumer expectations. There are two distinct opportunities further accelerated by recent agricultural reforms announcements. Firstly, existing FMCG companies can scale their production to utilize India as a regional production hub. Secondly, Indian food processing companies have an opportunity to Make in India for ready-to-eat and herbal/natural ingredients markets for the world. 

  • Digital as a Service (DaaS): Covid-19 implies that all business must go digital, willingly or otherwise. This is a transformation from classic IT/Outsourcing/ product development initiatives. A smorgasbord of technologies including AI, IoT, Robotics, Industry 4.0 and SCM collide and compete for choices in the new normal. This is a golden opportunity for India to leverage its technology/IT capabilities to deliver unique business models, flexible manufacturing, & more.  India can deliver DaaS as a platform for growth across industries.


ITTW (If This, Then What)?

India stands to benefit on multiple fronts, if we play our cards right.

  1. Economic growth: As Indian industries deliver for global supply chains, it can transform the economic trajectory. It delivers GDP growth, per capita national income, improved govt. finances, and resultant multiplier effects. 

  1. Employment generation & MSME ecosystem development: This can deliver huge dividends for India’s youth. Enhanced manufacturing production will ensure employment creation, a top national priority. It also expands the MSMEs suppliers and vendors ecosystem, creating new potential global winners from India. 

Result: more choices of employment including ancillary services, skill development and entrepreneurs. Both are the need of the hour.

  1. Social Dividend: Inclusive growth is an important agenda for serving our 1.3 billion citizens. This is a wonderful opportunity for Bharat and India to be equal contributors and benefactors of growth viz.  equitable development, uplifted healthcare and education standards for all.  

Conclusion:

This is a tough journey, but certainly one which India must traverse for stellar results. It’s a unique opportunity for India to leave our footprint on the global economic map.  A win-win for the country, industries and our people. 

Make in India and Made in India should and must represent world class innovation, hard work & stellar products and services. 

There’s a new starting line post COVID-19: let's run the race for India to be the winner, taking the world along with us.

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.


Sanjay Srivastava

The author leads Mahindra Lifespace’s Integrated Cities & Industrial Clusters (IC&IC) business including sales & marketing, business development and new initiatives’ evaluation. He is currently Business Head – Mahindra World City (Jaipur) Ltd and Board Director at Origins, Ahmedabad and Origins, Chennai.

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