The Indian government plans to soon revamp the Make in India initiative with policy changes and interventions in important sectors to meet twin objectives – create more jobs and boost economic growth of the country.
The government will put more stress to improve policies on five labour intensive and high potential sectors like leather, textiles and garments, engineering, pharmaceuticals and automobiles, the Economic Times reported.
Intensive meetings have been taken place in NITI Aayog, the industry department and the heavy industry ministries to revamp the auto industry policy which is a high potential sector to create more jobs.
About 10 million people join this sector every year, according to the Ministry of Labour and Employment.
"No country in the world has developed without a thriving auto industry... We need to nurture our auto sector in a fiercely competitive atmosphere," said a senior official.
The Centre is also looking for ways to push global automobile companies to engineer vehicles in India besides assembling them. The government's arm Invest India which promotes foreign investment, also suggested New Delhi promote automobile engineering by incentivising those global companies that bring technology in India.
"The government needs to promote design and exports in the auto industry," said Vikas Sehgal, vice chairman at Rothschild (South and South East Asia).
Also earlier this year, reports suggest that the government has announced plans to launch a scheme for the labour intensive leather and the footwear sector, besides textiles in a bid to increase job creation and boost exports.
This sector is important as it is a thrust segment under the "Make in India" initiative.
According to the industry experts, Rs 1 crore investment in this sector results in job creation for about 250 people. At present about 30 lakh people are directly employed in the sector.
"Apparels and leather sectors offer tremendous opportunities for creation of jobs, especially for women... Apparels are 80-fold more labour-intensive than autos and create 240-fold more jobs than steel," according to an Economic Survey report.
However, in the global market Indian leather industry faces robust competition from Chinese manufacturers in terms of pricing.
Besides this, according to the Economic Survey, Indian companies have struggles related to logistics, labour regulations, tax and tariff policy and the disadvantages arising from the environment surrounding trade as compared to the other competitors.