Jaitley differs with Rajan on 'Make in India'

'Manufacturing hobbled by dearth of capital'

Jaitley differs with Rajan on 'Make in India'

Finance Minister Arun Jaitley on Monday sought to differ from Reserve Bank of India (RBI) Governor Raghuram Rajan on the “Make in India” vs “Make for India” debate, saying that it was not relevant whether manufacturers produced for India or abroad.

“Whether ‘Make in India’ is made for consumers within India or outside is not so relevant. The principle today says that consumers across the world like to purchase products which are cheaper and are of good quality. They hire services which are cheaper and good quality,” Jaitley said, speaking at a workshop on ‘Make in India’.

Rajan had triggered a debate earlier this month when he said that the Make in India campaign should largely be for Indian consumers. He had said that the external demand growth was likely  to be muted, going ahead, and that is why India needed to produce for the internal market. The RBI Governor had also cautioned against picking a particular sector such as manufacturing for encouragement, simply because it had worked well for China.

“India is different, and developing at a different time, and we should be agnostic about what will work,” he had said.

Rejecting the idea, Jaitley said that it was about manufacturing of quality products at low costs, and it was not relevant whether they are sold in India or abroad.

The Finance Minister said that manufacturing would remain a challenge unless radical steps were taken. He said that the cost of capital was the single factor that had in recent times slowed manufacturing sector.

The government will undertake more steps to facilitate ease of doing business as part of the ‘Make in India’ initiative.

He said that a number of steps have already been taken in the past seven months to facilitate an investor-friendly climate in the country. However, manufacturing still remains a challenge. He said that the growth of manufacturing was necessary to ensure employment for the country’s youth.

The Finance Minister also underlined several initiatives to facilitate ease of doing business in the country.

“Entry point has to be eased, initial barriers lowered and removed, and after entry, enabling environment has to be created,” he said.

Jaitley also stressed on the need for streamlining the dispute resolution mechanism. Noting that the availability of lands for manufacturing must undergo a complex procedure, he said that the government was working towards removing the bottleneck.
DH News Service

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