Finance Minister Nirmala Sitharaman Urges Industry to Enhance Manufacturing Value Chain

Finance Minister Nirmala Sitharaman has emphasized the need for India to ramp up its manufacturing sector in order to increase its share in the global value chain and achieve self-reliance. Speaking at the CII Annual Business Summit, Sitharaman highlighted the importance of enhancing sophistication in product manufacturing and providing policy support to the industry.

Contrary to the advice of some economists, Sitharaman asserted that India must focus on increasing its manufacturing capabilities. She stressed the significance of India’s participation in the global value chain through policies that promote growth in the sector.

With the world adopting a China-plus one strategy in the wake of the COVID-19 pandemic, Sitharaman expressed optimism about India’s potential to enhance its manufacturing capacity. She cited a Capgemini Research Institute report which ranked India as a top investment destination for executives in Europe and the US looking to diversify their manufacturing operations.

Sitharaman highlighted the success of the Production Linked Incentive (PLI) scheme in the telecom sector, which has significantly reduced import dependence and boosted domestic manufacturing. She noted that India has achieved 60% import substitution in the telecom sector, showcasing the potential for growth in the Indian industry.

The Finance Minister also pointed out the transformation in the mobile and electronics sectors due to the PLI scheme, with India emerging as a major manufacturing hub for companies like Apple. She highlighted the increase in value addition in electronics and smartphone manufacturing, indicating significant progress since 2014-15.

Overall, Sitharaman’s remarks underscore the importance of strengthening India’s manufacturing sector to achieve self-reliance and enhance its position in the global value chain.