Prime Minister Narendra Modi launched the Make in India initiative on September 25, 2014, with the primary goal of making India a global manufacturing hub, by encouraging both multinational as well as domestic companies to manufacture their products within the country. The initiative aims to raise the contribution of the manufacturing sector to 25% of the Gross Domestic Product (GDP) by the year 2025 from its current 16%.
Over the past 20 years, Indian manufacturing has grown at slow pace. However, its share in the overall economy has stagnated at around 15%. Only the service industries’ contribution has grown to more than 50% and more at present. India’s unique positioning in the global marketplace as a services-led economy contrasts with most other developing economies.
According to experts, the services sector in India, employing skilled English-speaking workers has had its share of glory; it cannot provide employment to the teeming masses. The export led Manufacture can create a favourable balance of trade. And the domestic consumption led manufacturing can decrease the Current Account Deficit (CAD).
Various studies have shown convincingly that no other sector does more to generate broadscale economic growth and, ultimately, higher standards of living than manufacturing (China is the finest example) The manufacturing sector creates the substantial multiplier effect through its linkages with other sectors of the economy. Manufacturing output stimulates more economic activity across the wider economy than any other sector.