The Hindu : Business : Strategy paper on manufacturing shortly

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Friday, Jan 07, 2005

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Strategy paper on manufacturing shortly

By Our Special Correspondent

NEW DELHI, JAN. 6. The newly constituted National Manufacturing Competitiveness Council (NMCC) will come out with a long-term strategy paper on manufacturing and will provide inputs for the coming budget.

At the first meeting of the council, one concrete suggestion that came up was that innovations should be rewarded. The members also pointed to the high rate of incidence of indirect taxation, which was hindering growth of the manufacturing sector.

"The council decided to come out with a long-term strategy paper on manufacturing. At the first meeting, we discussed the elements that will go into it,'' the NMCC Chairman, V. Krishamurthy, told presspersons after the meeting. He said the council had also identified sectors such as textiles, leather, gems and jewellery and food processing that would need immediate attention.

"The elements that are likely to go into the long-term strategy paper include making the environment more conducive for manufacturing and enhancing competitiveness of the sector. The factors that will go into making the manufacturing sector more competitive were also discussed,'' Mr. Krishnamurthy said.

Later, the members of the Council met the Prime Minister, Manmohan Singh, who asked them to come forward with ideas to make the Indian industry more globally competitive while at the same time generate more employment. Dr. Singh also told the industry representatives that they should be prepared for lower tariffs and think in terms of world scale production facilities.

The Prime Minister also urged the members of NMCC to `think big and think into the future' as not too many Indians were thinking creatively about future possibilities.

Earlier, addressing the council, the Commerce and Industry Minister, Kamal Nath, said the Government endeavoured to make the council a hands-on group and was expecting suggestions from it after every meeting.

"Every meeting of the council will be productive. Some of these suggestions can be implemented right away while some could be accommodated in the budget,'' Mr. Nath said.

He said for the country to grow at 8 per cent, manufacturing would have to grow by 12 per cent. There was, therefore, a need to give manufacturing a direction, as this was the only sector that could absorb skilled and semi-skilled workforce outside the agriculture sector. "Our economic challenge is how to generate economic activity and employment,'' he said.

The cost advantages of manufacturing in India was evident to the global community which had started using the Indian manufacturing base in sectors such as auto-components, R&D, drugs and pharmaceuticals. "However, the investment climate in India and our manufacturing competitiveness are yet to reach its potential and this must be addressed on a priority basis,'' the Minister added. All the members of the council attended today's meeting, including chiefs of trade and industry chambers.

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