Red Tapism in India is impeding manufacturing
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2011-07-18

Red Tapism in India is impeding manufacturing

Japan has a better manufacturing policy than India

Bureaucratic hurdles and the slow pace of infrastructure development are the biggest deterrents for Indian manufacturing in comparison to China. China boasts of advantage of government’s model which implements policies faster there.

The UN Industrial Development Organisation (UNIDO) says growth in the Indian manufacturing sector for the quarter ended March 31, 2011 was 5.1 percent, lower than the world average of 6.5 percent and only a third of China.

Without infrastructure like electricity, roads, land development and other things you can't have manufacturing. Even Japanese Ambassador Akitaka Saiki, said infrastructure development was key, even to attract foreign investment in India.
Japanese investors and the government would like to see better infrastructure facilities in India.

As a result of the Comprehensive Economic Partnership Agreement (CEPA), which comes into force on Aug 1, they expect to double their trade and investments. But infrastructure is important for that to happen.

It is also believed that the electronics sector will spur India's manufacturing growth.

Describing electronics as a sunrise sector for Indian manufacturing, he said investments and perks in the field would yield expansive growth and employment opportunities.


The Indian government's IT task force has said the demand of electronics product is going to be expansive in the coming decade. Electronics worth $400 billion would be consumed by India by 2020, if the current rate of consumption continues, said in a report.

The production of electronic hardware in the country, says the report, is likely to grow to $104 billion by 2020.

Currently, international estimates place the electronics manufacturing industry as the largest in the world, pegged at $1.75 trillion and expected to touch $2 trillion by 2014

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