Pros And Cons Of India Case Study

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6.6. PROS OF MAKE IN INDIA CAMPAIGN:

• As Prime Minister Modi emphasized on the development of labour intensive manufacturing sector. So, this campaign will generate a lot of employment opportunities in Manufacturing, number expected to be around 100 million jobs by 2022.

• This campaign will help in achieving objectives of National Manufacturing policy i.e to increase the share of manufacturing sector in GDP from current 15- 16% to 25% till 2022.

• Employment will increase people’s purchasing power which ultimately helps in poverty eradication and expansion of consumer base for companies.

• The model of “look east and link west” policy wills strength the industrial linkages as well as bilateral ties with many countries.

• Export- oriented growth model will improve India’s Balance of Payment and help in accumulating foreign exchange reserves (which is very important given the …show more content…

However, FIIs are highly volatile in nature and a sudden exodus of hot money from India can effect a nosedive in the bellwether indices. Make in India will give an unprecedented boost to FDI flows, bringing India back to the global investment radar.

6.7 CONS OF MAKE IN INDIA CAMPAIGN:

• From a theoretical perspective, Make in India will tend violate the theory of comparative advantage. If it is not economically feasible to manufacture a commodity in India, it is best to import the same from a country which enjoys comparative advantage in its production. International trade, after all, is welfare augmenting.

• Reiterating the point made by Dr. Raghuram Rajan, India unlike China, does not have the time advantage as it undertakes a manufacturing spree. The essential question is – Is the world ready for a second China?

• Make in India will lead to an unsustainable focus on export promotion measures. One such measure is artificially undervaluing the rupee. This will have devastating consequences for the import

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