To give a fresh impetus to FDI inflows into the manufacturing sector, the department of industrial policy and promotion (DIPP) will likely focus on a few selective sectors out of the 25 under the Make in India programme. The remaining sectors will be addressed by the respective administartive ministries. “We have proposed to concentrate on a few selective sectors while the rest will be the responsibility of the respective ministries,” a senior government official said.
The few sectors which are likely to be the key focus sectors of DIPP are automobile, electronic manufacturing, food processing, defence and aerospace, pharmaceuticals, biotechnology, medical equipment, textile and capital goods. The sectors which are likely to be dropped from the ‘priority’ list is likely to include construction, media and entertainment, roads and highways, wellness and electrical machinery. “We are likely to finalise the matter soon,” the official said.
Other sectors that form a part of the 25 selected sectors include chemical construction, IT and BPM (business process management), leather, mining, oil and gas, ports and shipping, railways, space, thermal power, and tourism and hospitality.
The Make-in-India initiative was launched by Prime Minister in September 2014 as part of a wider set of nation-building initiatives. It was devised to transform India into a global design and manufacturing hub by encouraging both multinational as well as domestic companies to manufacture their products within the country. Led by the DIPP, the initiative aims to raise the contribution of the manufacturing sector to 25% of the gross domestic product by 2025.
According to the data from DIPP, foreign direct investment in India grew 22% in April-December 2016 to touch $35.8 billion. However, a majority of FDI inflows India received have not been for the manufacturing sector, as per the DIPP data.
The data showed that core manufacturing sectors such as automobiles, pharmaceuticals, power, construction and chemicals have so far attracted about 20% FDI, while the non-manufacturing sectors — services, computer software and hardware, and trading, telecommunications, tourism and hotels attracted around 40% of the FDI.
Source: Financial Express