Indian government’s week-long “Make in India event,” which ended in Mumbai on Thursday, was initially marred by a fire that broke out on one of the event stages and a strike by rickshaw drivers that hit traffic in the financial capital.
But the organizers have reason to cheer as the event is said to have secured investment pledges worth Rs 8 trillion ($117 billion) with host state Maharashtra accounting for a major chunk of it.
While it remains to be seen whether the funds promised will actually flow in, such business events seem to serve the big cities and affluent states hosting them.
True, Maharashtra (Mumbai) could become the gateway for the rest of the country. But smaller cities and towns in India will remain largely ignored and undeveloped.
Prime Minister Narendra Modi’s Make in India campaign offers more rhetoric than substance. Its logo — the lion made of cogs – indeed catches one’s attention. But will that make India’s economy roar?
One of the top government officials said the Mumbai event showcased, connected and provided collaboration for Indian manufacturing to boost the sector to China-like levels.
By attracting more manufacturers, the Modi government plans to create millions of jobs for the 1.3 billion population whose numbers may soon surpass China.
Of course, more job opportunities will shift workers from farms to export-focused industries in Indian cities. But with demand for global goods falling, does the world need another export powerhouse like China?
To ensure success for the Make in India campaign, the government has to first bring positive changes in core areas of business like land, labor, power and capital.
Take the case of land. Under the new land-acquisition law, companies have to pay four times the market price in rural areas.
While wages have been rising in China, Indian laborers, who are comparatively paid less, remain stuck in agriculture.
For Indian businesses, power supply is erratic and expensive while farmers enjoy free power for their agricultural operations. In China and many emerging economies in Asia, the rules are just the opposite.