{"id":209830,"date":"2022-10-08T20:20:57","date_gmt":"2022-10-08T14:50:57","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=209830"},"modified":"2022-10-08T20:20:57","modified_gmt":"2022-10-08T14:50:57","slug":"make-machines-in-india-why-economists-arguing-against-policy-emphasis-on-manufacturing-are-completely-wrong","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/make-machines-in-india-why-economists-arguing-against-policy-emphasis-on-manufacturing-are-completely-wrong\/","title":{"rendered":"Make machines in India: Why economists arguing against policy emphasis on manufacturing are completely wrong"},"content":{"rendered":"\n

Source<\/strong>: The post is based on an article\u00a0\u201c<\/strong>Make machines in India: Why economists arguing against policy emphasis on manufacturing are completely wrong\u201d <\/strong>published in\u00a0The Times of India<\/strong>\u00a0on\u00a08th<\/sup> October 2022<\/strong>.<\/p>\n

Syllabus: GS 3 \u2013 Industries and industrial policies <\/strong><\/p>\n

Relevance:\u00a0<\/strong>manufacturing sector and need to look into it<\/strong><\/p>\n

News: <\/strong>Some experts today argue that India should encourage service sectors and the policies for manufacturing sectors are criticized.<\/p>\n

One of the reasons for this argument is that the service sector is big and it contributes about 55% of our GDP.<\/p>\n

However, size alone is not important as Simon Kuznets (the father of GDP) said that GDP is a measure of wealth not of welfare.<\/p>\n

What is the current situation of service sector in India?<\/strong><\/h5>\n

Service sectors in India include low-to-unskilled labour force and none of them are skilled enough to be exported to other countries.<\/p>\n

80% of jobs in this category are in construction, transport, retail and beauty.<\/p>\n

Even Indian doctors are not good at providing required medical services in India as they lack proper training and modern technologies.<\/p>\n

How can our service sector become world class and ready for export?<\/strong><\/p>\n

International experience tells us that when the manufacturing sector grows and reaches a certain saturation level then the qualities and skills begin to move towards the service sector.<\/p>\n

This has happened in the West, in Europe and the US, and also in the East, in South Korea and Japan.<\/p>\n

Therefore, it is necessary to strengthen the manufacturing sector because product innovations and differentiation first take place in this sector.<\/p>\n

What is the current situation of manufacturing sector in India?<\/strong><\/h5>\n

Currently India spends 0.6% of its GDP on R&D in the manufacturing sector which is one of the lowest in the world.<\/p>\n

Further, only about 7% of the 2. 5 million engineers in India can perform core engineering tasks.<\/p>\n

Land acquisition is one of the problems for setting up manufacturing plants in India. However, the data shows that only 8% of stalled projects are because of land acquisitions problems.<\/p>\n

How can the manufacturing sector help in the growth of the service sector?<\/strong><\/h5>\n

India\u2019s IT sector only employs 3 million people while in the US there are about 12 million people working in the IT sector. South Korea\u2019s IT sector has moved ahead because manufacturing and R&D.<\/p>\n

Therefore, the growth in the manufacturing sector will create an advanced service sector.<\/p>\n

Moreover, a mature service sector is hugely dependent on the manufacturing sector and not independent of it. The service sector grows only with a strong manufacturing sector.<\/p>\n

Studies in the US show that the largest consumer of services is the manufacturing sector and high-end manufacturing requires the service sector to be attached with it for the best results.<\/p>\n

Therefore, India should focus on manufacturing sector to achieve best results from the service sector.<\/p>\n","protected":false},"excerpt":{"rendered":"

Source: The post is based on an article\u00a0\u201cMake machines in India: Why economists arguing against policy emphasis on manufacturing are completely wrong\u201d published in\u00a0The Times of India\u00a0on\u00a08th October 2022. Syllabus: GS 3 \u2013 Industries and industrial policies Relevance:\u00a0manufacturing sector and need to look into it News: Some experts today argue that India should encourage service… Continue reading Make machines in India: Why economists arguing against policy emphasis on manufacturing are completely wrong<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[216,10496],"class_list":["post-209830","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-gs-paper-3","tag-times-of-india","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704796751},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/209830","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=209830"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/209830\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=209830"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=209830"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=209830"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}