The center is working on a plan to build more than 20 purpose-built mega industrial parks across the country by 2030, two people close to the development said. The goal is to move India from its current 5th place to the 3rd place in global manufacturing. These discussions involve the Ministry of Pharmaceuticals, Ministry of Textiles, Ministry of Petroleum and Natural Gas, and Ministry of Commerce.
The plan calls for the construction of five chemical and petrochemical manufacturing sites, seven textile parks, five leather and footwear parks, four medical device parks, and three bulk pharmaceutical parks, providing support for companies in this field. Designated areas will be provided, two officials cited above told the Mint. on condition of anonymity.
“The idea is to designate areas where it is easy to provide facilities to companies,” the first official said, adding that there has been criticism that India’s manufacturing development has been “sporadic and unplanned”. Some parks.”
Also read | Strategic move: Center to encourage MSME industrial parks on private land
These parks will be a mix of both greenfield and brownfield, most of which will be newly designed and implemented, and some existing parks will be upgraded.
“The goal is to increase India’s contribution to global manufacturing to at least 4% by 2030,” the second official said. The official pointed out that without these parks, India’s contribution would grow to only 3.25% of the world’s, as per current projects. Global manufacturing.
According to World Bank data, the top five manufacturers in value-added output are China with $4.975 trillion, the United States with $2.497 trillion, Japan with $818 billion, Germany with $752 billion, and India with $456 billion. It’s dollars. India’s contribution is approximately 3% of the total export value.
Questions sent to the Ministry of Pharmaceutical Sciences, Ministry of Textiles, Ministry of Petroleum and Natural Gas, and Ministry of Commerce remained unanswered by press time.
big moves in india
Indeed, Indian businessmen have accused China of using such parks to build manufacturing. At the recent Mint CEO Roundtable, Mahesh Chhabria, managing director of diversified conglomerate Kirloskar Industries, said that even though India is the second largest footwear manufacturer, it still sells soles and uppers to China. He pointed out that it was imported from
“It’s amazing how China has created a footwear cluster. In a 10 square kilometer cluster, you can source everything from the smallest to the largest to make shoes,” Chhabria said. .
Also read | Blackstone establishes $900 million logistics platform ‘Horizon Industrial Park’ in India
Chhabria added that big global brands are succeeding in China because sourcing has arrived just in time in their backyard. “Every design shop that manufactures shoe uppers can be outsourced to itself. Where in India does that concept come from?” he said.
India’s move to create such dedicated manufacturing parks is an attempt to replicate China’s success, in which these parks have played a major role, said the official cited first above.
A banker who works with many global companies said India should work on planned manufacturing hubs like China.
“Manufacturing has grown in India, but China’s development is more concentrated,” said the official, who declined to be named.The park will help attract several global companies looking to set up in India. He added that it would be.
Global organizations are focusing on the role of China’s industrial parks in helping China become a manufacturing powerhouse.
Also read | Factory production growth slows in June but remains strong
“Over the past 40 years, China has successfully built and operated various industrial parks at home and abroad, overcome the problems hindering the development of parks such as infrastructure financing and coordination of policies and measures, and accumulated a rich treasure trove of industrial parks. “experience, knowledge and good practice,” the United Nations Industrial Development Organization said in a November 2020 study.
How parks can help
In the pharmaceutical sector, for example, analysts say dedicated parks will help companies scale up efficiently and at lower cost.
Pharmaceutical facilities require several common infrastructure facilities such as a central wastewater treatment plant, solid waste management, and common warehouses, among others. “If it is an industrial park, these costs are shared among the players in the park… no one player bears the costs,” said Aditya Khemka, fund manager at Incred Asset Management. spoke.
He added that there is also a need to focus on the functions of parks before making them large-scale. “These parks are more or less dysfunctional because they are not maintained properly, there is no infrastructure, there are no road or railway structures,” Khemka said. said. It’s always important to work with what you have first to open up more avenues. ”
And read | Indian importers outsmart China on Dubai route
India has so far achieved partial success with SEZs (Special Economic Zones), where the services sector has benefited from tax incentives. However, the new plan will focus less on tax incentives and more on providing facilities available to businesses so they have enough resources to grow.
