Advantages and Disadvantages of Make in India

make in India logo advantages disadvantages
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Written by Editorial Staff

Editorial Staff at BusinessAlligators is a team of business experts led by Lokesh Tanwar & Priyanka Singla. Trusted by over 100K readers worldwide.

August 21, 2016

Make In India is a Lion’s Step.So, pledged the prime minister of India, Narendra Modi, during the inauguration of the prominent ‘Make in India’ campaign.

Make in India, is a propaganda initiated for the sole purpose of inviting various commercial sectors from all around the world, to engineer their products in India and sell them anywhere they wish. The crusade had instigated on 25th September 2014, and since then has emerged as one of the grandest triumphs of the Indian economy.

Make in India has come with lots of benefits and advantages for the Indian Economy. Due to this fact companies from across the globe making a huge investment in Make in India project, and have thrived successfully, making India a hub for the manufacturing companies, overshadowing countries like the USA in the collection of FDI up to $63 billion during the previous year. (If you are planning to start a business in India then you can Click Here to know the complete process.)

But, since the commencement of the make in India movement, a never-ending dialogue has taken place criticizing as well as succoring the campaign.

The finest of the industrialists, support the make in India operation and are happy to invest in the vision of an economically strong India, while on the other hand, there is another set of industrialists and economists who strongly hold the belief, that the Make in India might be a huge threat to the evolution of India, ecologically and economically.

The conclusion of Make in India can only be drawn if we take a look at the various arguments put forth by the credit as well as the debit side of the Make in India crusade. Here, we present a few benefits/ advantages along with disadvantages of Make in India the lion made up of clogs, to help you decide whether you should invest in Make in India project or not. I would also recommend you to go through our article on the impact of Make in Inda over different sectors, it will help you in understanding what’s in the Make in India project for each sector and how it will effect the economy of India.

Advantages of Make in India

Let’s have a look at the 10 biggest advantages of Make in India

1. Develop Job Opportunity

One of the main purposes of Make in India crusade is to provide job opportunities for as many citizens of India as possible. It has targeted the young generation of the country as its prime beneficiary. The investments in the targeted sectors, i.e. telecommunications, pharmaceuticals, tourism etc. will encourage the young entrepreneurs to come forth with their innovative ideas without worrying about the source of speculation.

Related- Conclusion of GST

2. Ameliorate the Vicinity

In order to manufacture in India, a particular industry requires a promising location to set up machinery as well as factories. To fulfill this requirement, not only the areas were chosen would be improved but also the neighboring locations will be highly benefited.

For a developing nation, such as ours’ an initiative of this kind is extremely crucial. In addition, the labor hired, from the locality would also improve the financial status of the families living nearby.

3. Expand GDP

Due to the manufacturing of products in India, economic growth is inevitable, which will not only boost the trade sector but also will increase the GDP of Indian economy as with the setting up of new factories and various investments being speculated in the Indian commercial sectors the flow of income will be humongous. Various sectors such as exportation, architecture, textiles, telecommunications etc. are likely to flourish inevitably, strengthening the Indian economy which is already the seventh largest in the world.

4. Fortify the Rupee

The emergence of the manufacturing industries would automatically convert India into a hub for the fabrication of various commercial products; as a result, there would be a grand collection of the FDI, which, in turn, would strengthen the rupee against the domination of the American dollar.

5. Increase in Brand Value

Most of the urban population prefer international brands rather than putting their faith in Indian retailers. As a result, the small manufacturing companies suffer an extreme loss in the market.

Due to the Make in India campaign, such small manufacturers will be provided with a real shot at the business. With, companies investing in such small time retailers from all around the world, the brand value of Indian merchandise will increase dramatically.

6. Up-gradation of Technology

India being an underdeveloped country obviously lack various latest mechanization, which, is a big hurdle in the path to development of the nation. Hence, with the myriad of countries coming forth by the make In India crusade, India will be given the opportunity to make use of the latest technology these countries bring along.

Not only will India benefit from the knowledge and use of the technology but also, the concerned nations will be provided with a skilled and erudite labor.

7. Ease of Business

India is a nation which ranked 130th on the ease of doing business scale. But with the open invitation given to the entire world to manufacture their products in India, the various restrictions opposed over the entrepreneurs will be lifted and aspiring businessmen from all over the globe could invest in India with no stress at all.

8. Availability of Young Minds

Most of the young generation of India plans to move out of the country in the hope of a better future. Due to the lack of young labor, India has always been deprived of innovative and new ideas. With the Make in India campaign, the young population would not only be provided with employment but also their young and fresh minds would take the industrial sector to new heights. Making it a win-win situation for the India as well as the concerned countries. For more on how Indian young minds are starting their own startup by remaining in India, you can Click Here.

9. Development of Rural Areas

It is a well-known fact, that a factory set up not only improves a particular area but also provides for the locals with employment, thus the quality of life of people would automatically enhance. Amenities like schools, hospitals, and other public conveniences will be developed for the betterment of the public.

10. Flow of Capital

Since the beginning of capitalization, the Indian currency is being spent on the foreign countries. With the introduction of make in India, the capital will not only remain in India, but also the foreign currency will be provided to the nation as well. In a nutshell, India will not spend on foreign countries, but the foreign countries will spend in India in the form of investments and wages.

Related- 11 Most Profitable Businesses in India with Low Investment

Disadvantages of Make in India

Now let’s have a look the biggest disadvantages of Make in India

1. Negligence of Agriculture

The most negative impact of the Make in India campaign will be in the agriculture sector of India. It is a well-known fact that Indian Territory has 61% cultivable land. With the introduction of industrial sectors, the agriculture in India will be neglected somewhat.

2. Depletion of Natural Resources

Since Make in India is primarily based on manufacturing industries, it demands the set-up of various factories. Usually, such projects consume the natural resources such as water, land etc. on a large scale. With the rapid devouring of such precious resources, India might be left with zero opportunity to replenish them, threatening the survival of such a large population in the near future.

3. Loss for Small Entrepreneurs

The Make in India campaign welcomes foreign countries to manufacture in India with open arms, this automatically eases up the various restrictions over trade with foreign countries, inviting the attention of the international commercial companies. However, these companies will not only seduce the Indian population but also would dominate the small local entrepreneurs and force them out of business.

4. Disruption of Land

As stated above, India is very rich in the agriculture sector. About 60% of the Indian soil is arable. With the emphasis being given to the Make in India campaign, thousands of companies would come forth to set up their factories on the land which could be used for cultivation. Eventually, this set up of manufacturing factories would lead to the permanent disruption of the agrarian land in the near future.

5. Manufacturing based Economy

Indian economy is one of the largest economies in the world. It constitutes of three sectors i.e. agriculture, industry, and services. Now the Indian economy majors up from the service sector which contributed up to 57% of the GDP. But with the introduction of the Make in India campaign, the economy is likely to rely completely on the manufacturing and exporting while the import industry will remain static. This eventually will be a huge loss for the other economic sectors and would automatically reduce the advancement of Make in India.

6. Interest in International Brands

As stated earlier, the brand value of Indian merchandise will definitely increase. But the Indian upper class, which can actually afford such merchandise, is addicted to the foreign label. This will eventually become a big hurdle for the local entrepreneurs as a great level of promotion is required to build the confidence of people in the local brands.

7. Pollution

One of the biggest problems which are prevailing in India is pollution. According to statistics, India has a pollution index of 76.50. With the make in India movement, this pollution level is likely to arise in a couple of years. Eventually, making the condition in India worse. Hence, Make in India might be economically but it will have an inverse effect ecologically.

8. Bad Relations with China

The Indo-China relation is already a problematic cause for the country, with the initiation of the make in India crusade, India stands as one of the most promising rivals for China. This automatically will worsen India’s long-term feud with China, gradually with the success of Make in India, it is possible for the situation to become worse among the two economically growing countries because India has the advantage of young and skilled workforce over China which will expectedly take make in India to new heights in the near future.

On a concluding note, it can be safely stated that make in India is an opportunity for everyone. It is a prospect, which if given time will flourish like a spring flower and would provide with the expected fruit.

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  13. Anil

    1. Negligence of Agriculture
    A good balance will be required, after all, having money is not enough if there are no agri-products to consume at affordable prices and quantity.

    2. Depletion of Natural Resources
    Make in India should be enough to supply the needs of India, not the world. This is to ensure that we don’t have to spend our dollar reserves and we can afford quality products with the rupee.

    3. Loss for Small Entrepreneurs
    We export Intellectual Products that we develop not reselling- Entrepreneurship

    4. Disruption of Land
    If our need is limited to Indian market needs this disruption can be limited.

    5. Manufacturing based Economy
    Imports must be reduced to have surplus Foreign reserve and stable rupee. Import businesses must shift their investment to Research & Development leading to exports & support Make in India businesses.

    6. Interest in International Brands
    Local brands still have a large middle class and lower income class to sell to. Local brands need to innovate in order to compete with Foreign brands.

    7. Pollution
    Recycling and Waste processing industry can be developed hence create jobs also. R&D in this sector is very important as India can lead in Recycling & Waste processing technologies resulting in IP owned and increase in Foreign Reserves.

    8. Bad Relations with China
    China Belt & Road Initiative is already against India. China respects threats only. India has to fulfill its destiny & China has sorted out its relation with India in the right way plus China does not have the right to dominate the World Economy.

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