India has been struggling hard to mark its presence in the international market as capital goods manufactures. The government has approved the much awaited policy, National Capital Goods Policy, which is the first launch. This approval by government shall mark a decrease on relaying on international resources to buy the equipments. This will encourage the industries to boost up domestic manufacturing of capital goods.
Approval of Capital Goods Policy shall drop multiple impacts in the Indian economy. The major ones are listed below:
An increase in both direct and in-direct employment will be observed, which means it shall rise from 84 lakh jobs to a massive number of 3 crore.
Increase in production of capital goods. It will rise from Rs 2.3 lakh cr (2014-15) to Rs 7.5 lakh crore in 2025.
Long-term and stable duty structure to get imposed to encourage domestic manufacturing.
Domestic manufacturing shall result in positive increment in the economy.
Export shall also increase from 27% to 40%.
Manufacturing sector to become the strong pillar for the economy.
Good competition with the giant manufacturer “China”.
Become global exporter in the sector of capital goods.
Enhancement of technology.
All the above listed impacts are positive and shall help economy to mark its presence as a strong player of manufacturer in the International market. In the past few years, import of machinery and other equipments have gradually increased by 5.2% to 9.7 billion.
Railway Minister Suresh Prabhu said after Cabinet meeting- “Capital goods manufacturing, if it happens in India, along with the manufacturing that is going to happen downstream, the entire economy gets fillip”.
A statement issued by the government says- “It will increase the share of domestic production in India’s demand from 60% to 80%, thus ma king India a net exporter of capital goods”.
Business Chamber FICCI said – “We are happy to see the roadmap for the capital goods sector in India and its recognition as a strategic sector. India has the potential to be the net exporter of capital goods as against the net importer currently. National Capital Goods Policy is definitely the need of the hour, which will provide the much needed impetus to the sector and will go a long way in achieving the objectives of Make in India”.
All the heavy industries executives are happy by the approval of the policy and they say this shall become a great move in Make In India initiative. This will enable India to become the net exporter. Jobs are soon to be available in massive number which shall solve the issue of unemployment among the youth.
Verdict: This policy is going to become one of the major reasons for the improvement of Indian economy. Industries are going to boost themselves in the manufacturing sector and take an initiative to become global net exporter. Things are getting better and better day by day, this shall be interesting to see a massive growth of the Indian economy over the time.