Nirmala Sitharaman: Why are you hesitating to get into manufacturing, FM Nirmala Sitharaman asks India Inc

Finance Minister Nirmala Sitharaman on Tuesday sought to know from India Inc what is stopping them from getting into manufacturing when countries abroad are showing their belief in India.

“Countries abroad think India is the place to be right now. FDIs and FPIs are coming. Retail investors believe in India,” she said and asked what is stopping India Inc and if it was a case of lack of self-belief.

The NDA government will do everything for the industry to invest in India and provide the schemes required, she said. Policies like PLI, tax cuts have been provided to support the private industry in India. “No policy can be the end in itself, we will keep updating them,” the minister said at the 15th edition of the Mindmine Summit.

A lot of foreign companies have been assured of India’s facilitative ecosystem. The finance minister said that a lot more companies are looking to move their manufacturing operations out of China and want to come to India as they find policies like PLI attractive.

The government last year rolled out the scheme with an outlay of about Rs 2 lakh crore for as many as 14 sectors, including automobiles and auto components, white goods, textiles, advanced chemistry cell (ACC) and speciality steel.

The scheme has been specifically designed to boost domestic manufacturing in sunrise and strategic sectors, curb cheaper imports and reduce import bills, improve cost competitiveness of domestically-manufactured goods, and enhance domestic capacity and exports. The strategy behind the scheme was to offer companies incentives on incremental sales from products manufactured in India, over the base year.

Currently, the scheme covers sectors like automobiles and auto components, specialty steel, telecom and networking products, and electronic/technology products.

The litmus test for India in the next 25 years is to see how we can benefit from our workforce, the minister said. “In the case of the PLI scheme, we looked at its impact on our labour force. We are looking for in situ solutions for MSMEs as locally they are the ones who train and employ. So the policy has necessarily underlined the importance of labour,” Sitharaman said.

Demand for including sectors like certain electronic components, toys, furniture, bicycle, and containers has come against the backdrop of the government’s move to cut imports and boost domestic manufacturing.