Source-This post on Shift from “Make in India” to “Make Products in India” has been created based on the article “Embracing ‘Make Products in India’ published in “Business Standards” on 15 March 2024.
UPSC Syllabus-GS Paper-3– Indian Economy and issues relating to Planning, Mobilization of Resources, Growth, Development and Employment.
Context-The article highlights the need to shift from Make in India to Make Product in India for realizing the vision of Viksit Bharat.
What is the need for this shift?
1) Ensuring high growth rate-India’s annual growth must consistently surpass 10 to 12 % for next many years to achieve a developed country status. In this context, it is important to focus developing products in domains like electronics,automobiles,and defence which can drive India’s growth at faster pace. For ex-South Koreas success could be attributed to the development of these sectors.
2) Knowledge driven economy- In a tech-driven knowledge economy, a product’s intellectual property contributes half its value. This makes it challenging to equal value-creation through manufacturing only. Hence, there is a need to shift from Make in India to Make Products in India.
Read more- An analysis of PLI (production-linked incentive) scheme
What steps can be taken to shift from Make in India to Make Products in India?
1) Liberalize research & development – There is a need to open research and development(R&D) beyond the public sector. This has been successfully done in the case of space and drones. There is a need to add atomic energy and deep-sea exploration to this list.
2) Public-Private partnership– There is a need to transform competition into meaningful partnerships. For instance, during the Covid pandemic,theNational Institute of Virology, an ICMRlab,isolated the strains of SARS-Cov-2 virus and shared them with Bharat Biotech. This led to the development of Covaxin, which became available in just a few months.
3) Ease of doing innovation– Regulators must prioritize innovation over adherence to rules. For ex-during pandemic, despite the rules not providing for emergency use authorisation,authorities invoked a generic provision and issued restricted use licences for vaccines.
4) Government procurement– An OECD survey in 2017 revealed that 80 % of nations supported innovation through assured government procurement. It acts as a validation for innovators, instils consumer confidence, and ensures revenue streams, thereby mitigating risk.
5) Government Funding – There is a need to mitigate risk in product development through government funding. India should learn from successful models like Darpa in the USA and Jozma in Israel. There should be expansion of iDEX model beyond defense.
6) Demographic dividend – India’s demographic dividend needs to be leveraged to create a sizable talent pool in emerging technologies. Academic universities should be transformed into hubs that nurture entrepreneurship and innovation.
7) Brand building for indigenously developed products – Indian Brand Equity Foundation should be tasked with creating global brands for indigenously-developed-products.
Further,the government should promote export of indigenously developed products through bilateral and multilateral mechanisms.
8) Standard Making – Geopolitics plays a huge role in standard making. For ex- delayed World Health Organization approval for Covaxin. Thus, to assert influence, the government must collaborate with industry to secure decision-making roles in global bodies.
“Make Products in India” is a strategic imperative and immediate government attention is necessary.
Question for practice
What steps can be taken to ensure transition from Make in India to Make Products in India?
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