During a panel discussion at the World Economic Forum’s India Economic Summit, senior economists and business leaders strongly backed India’s new manufacturing policy. This new policy hopes to turn India into a manufacturing hub which will result in overseas investment. B. Muthuraman, Vice Chairman of Tata Steel and President, Confederation of Indian Industry (CII), claimed that, “Ten to 12 million new people are joining the job market every year — if you don’t have manufacturing, it will be a huge problem.”

Rajat Nag, Managing Director-General, Asian Development Ban, Manila explained that in China, every 1% growth in GDP has resulted in poverty decreasing by 0.8%. However, in India, the same growth reduces poverty by 0.3%. Nag further explains that this is due to the fact that India’s growth driver has been services rather than manufacturing. He adds that India’s manufacturing needs to switch to a labor-intensive model from a capital-intensive model.

For the policy to become a reality there will have to be investment in infrastructure, good governance, and skill development. Rudolf Hug, chairman of the board of directors, Panalpina World Transport Holding, Switzerland claimed that India’s logistics infrastructure is “overstretched and stalled by high bureaucracy.” For example, 57% of goods transported within India are transported by road, compared to 22% in China. This is the most inefficient, expensive and emissions intensive form of transport, and a huge number of check points are passed within India. This “trust deficit” needs to be addressed with better governance. Manufacturing zones need to have the freedom to experiment with new forms of governance and collaboration.

India’s new manufacturing policy may increase the number of jobs available in numerous areas in this industry. Exporting and importing will have an increase in jobs, and there will be a huge demand for labor to produce the products.

Executives will be required to oversee the new manufacturing of products, and to manage importing and exporting of goods. Innovative executives with ideas on how to increase the efficiency and ease of transporting goods may begin to play a huge role.

Those with skills within the manufacturing field need to brush up their skills or learn new ones so that they are the most desirable for what is sure to be a huge increase in jobs.

Those trained in these areas and any area of manufacturing may soon be in high demand. Executives in India who are looking for new challenges may wish to broaden their horizons by training or honing skills in order to meet the demand. India may also begin to attract executives from overseas who are looking for exciting and innovative challenges in a fast-paced and growing environment and economy.

   
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This article was written by Bella Barda, Emerging Markets Assistant from the Association of Executive Search Consultants (AESC).

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