New industrial policy in the pipeline

Under the aegis of the Ministry of Commerce and Industry ministry, the Department of Industrial Policy and Promotion (DIPP) is likely to release a new industrial policy by October which will focus on encouraging Indian branded products with higher value addition. The proposed policy will also review the existing foreign direct investment (FDI) policy regime to facilitate greater technology transfer.
 
The policy is expected to replace the United Progressive Alliance government’s National Manufacturing Policy (NMP) released in 2011, which sought to create 100 million jobs by 2022. “It is time to shift from a policy of ‘continuity with change’ in 1991 to radical and accelerated reforms for greater strategic engagement with the world. A comprehensive, actionable, outcome-oriented industrial policy will enable the industry to deliver a larger role in the economy; to fulfil its role as the engine of growth; and to shoulder the responsibility of adding more value and jobs,” a discussion paper released by DIPP said.
 
DIPP has adopted a consultative approach for formulating the industrial policy by setting up six thematic focus groups and an online survey on the department’s website to obtain inputs. The six thematic areas are manufacturing and MSME; technology and innovation; ease of doing business; infrastructure, investment, trade and fiscal policy; and skills and employability for the future.
 
The policy will aim to set a clear vision for the role of industry and industrial growth in the growth and development of the economy. The report added that the policy will aim to attract USD 100 billion of FDI in a year, up from USD 60 billion in 2016-17. It will also aim at retaining investments and accessing technology. The policies will also introduce reforms to enhance labour market flexibility with an aim for higher job creation in the formal sector and performance-linked tax incentives.