How “Make in India” Will Effect Indian Economy?

How “Make in India” Will Effect Indian Economy?

Make in India is an initiative of the Government of India to encourage multinational, as well as domestic companies to manufacture their products in India. It was launched by Prime Minister Narendra Modi on 25 September 2014. India would emerge, after initiation of the program, as the top destination globally for foreign direct investment, surpassing China as well as the United States.

With this initiative, Mr Modi is literally inviting the rich and semi-rich countries to step in India and invest their money for the future of India. It’s like inviting the countries to set up their companies in India and manufacture in the territory of our country.

Sell everywhere but manufacture in India

sums it up all.

Now, this initiative has a great impact on the economy of our country. Obviously, if the big companies will setup their branches here, it will directly affect the GDP of India. But, is the effect negative or positive? Read here!

Related- Advantages and Disadvantages of Make in India

Supreme Objective

The supreme objectives of Make in India are as follow:

Manufacturing Sector

  • One online portal for the process of industrial license applications.
  • Earlier, the validity of the industrial license was of two years, now it has been increased to three years.


  • Constructing industrial infrastructure and smart cities
  • Intensifying skill development
  • Safeguarding intellectual development

Worthy and Superior Industrial Sectors

  • Endorsing innovation
  • To accelerate investment
  • 100% FDI in defence, railways, and construction

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Main Focus of Make in India

The main focus of Make in India Campaign is mainly on 25 sectors. Almost every sector is capital-intensive and demands a lot of skill. So, with the more and more investment in these sectors, the main focus will be on increasing employment and the use of advanced technology. These sectors are

  1. Automobiles
  2. Food processing
  3. Renewable energy
  4. Automobile components
  5. IT and BPM
  6. Roads and highways
  7. Aviation
  8. Leather
  9. Space
  10. Biotechnology
  11. Media and entertainment
  12. Textiles and garments
  13. Chemicals
  14. Mining
  15. Thermal power
  16. Construction
  17. Oil and gas
  18. Tourism and hospitality
  19. Defence manufacturing
  20. Pharmaceuticals
  21. Wellness
  22. Electrical machinery
  23. Ports
  24. Electronic system
  25. Railways

Related- Impact of Make in India over Different Sectors of India

Make in India Impact on the Economy

Recently, the country has been hit by the recession and it is still struggling to come out of it. The citizens of India have had enough so they decided to turn the government upside down and change it altogether. With the change in the government, a drastic change in the ways in which the system works could be seen.

Today, everyone is well aware of the Make in India initiative and the motives that this initiative holds. On the other hand, the impact of this campaign is no secret, either. This is going to make India, one of the leading nations in the entire world if followed dutifully.

Related- What is Make in India?

Make in India Contribution on Gross Domestic Product (GDP)


SectorsContribution (Before Make in India)Expected Contribution (After Make in India)
Automobiles$8 Billion50 Billion
Food Processing $1.43 Trillion $7.21 Trillion
Renewable Energy $20 Billion $40 Billion
Automobile Components $10.81 Billion$39 Billion
IT and BPM$143 Billion$300 Billion
Roads and Highways$14 Billion$57.8 Billion
Aviation$17 Billion$25 Billion
Leather$28 Billion$76 Billion
Space$47 Billion$85 Billion
Biotechnology$1.1 Billion$7 Billion
Textiles and Garments$67 Billion$100 Billion
Chemicals $16.8 Billion $70 Billion
Mining $56 Billion $80 Billion
Thermal Power $34 Billion50 Billion
Construction$78.5 Billion $140 Billion
Tourism and Hospitality$20.236 Billion $21.071 Billion
Defense Manufacturing$56 Billion$100 Billion
Pharmaceuticals and Wellness$500 Billion $1 Trillion
Electrical Machinery$54.3 Billion $65 Billion
Ports$68.3 Billion $86 Billion
Electronic System $43 Billion $94.2 Billion
Railways$80 Billion $100 Billion


Just between September 2014 and November 2015, the government had received proposals from the interest companies for manufacturing electronics in India worth Rs. 1.20 Lakh Crore. Moreover, 24.8% of smartphones that were shipped in April-June of 2015 were manufactured in India. This initiative has the tendency to turn the Indian economy upside down, all for the better reasons. With the investment in the manufacturing sector, advancement in the technology, generation of the employment opportunities, and the ways to make the labour skilled, our country will be touching the sky of success in just a matter of few years. Moreover, the way Modi government has been working is commendable and it justifies the need of transformation in the country.

However, like every coin has two sides, we cannot ignore the negative impact and the probabilities of failure of this campaign. There are some constraints and limitations to this campaign as well.

The main thing is that the focus is on the manufacturing sector, and the population of India is majorly middle-class or lower middle-class. So, the products manufactured by the foreign companies will be entirely for the upper section of the society. Hence, it is possible that the goals and aspirations of Make in India may not find much success.

However, as that quote goes ‘Never judge a book by its cover.’ So, today, we are not going to judge the Make in India initiative by its policies and schemes, but future results. We will hope for the success of this initiative.

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In the end, when you talk about all the impacts that the Make in India has on the economy, the only thing that the citizens are concerned about is the country’s GDP. After all, that is the only thing that defines the accurate situation of the country. The better the GDP, the more developed will be the nation.

And, in this case, the campaign of Mr Narendra Modi is concentrating more on the manufacture, so it is natural that it will have a better impact on the GDP. Currently, the GDP is $1.877 trillion (6%), and it is increasing at the annual rate of 5%. And, the intentions are to make India stand at the 3rd position by 2020 in terms of Gross Domestic Product.

Himanshika Sharma

Himanshika Sharma

Content Writer at Business Alligators
Himanshika Sharma hails from Ambala City. Academically, she is a graduate in economics, but professionally she is an author, blogger, reviewer, and a content writer. The more she has spent time in the writing industry, the more she is trying to gain the power that the words hold.
Himanshika Sharma

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