India : The next Manufacturing giant!!
YaleGlobal, the magazine from Yale Center for study of Globalization, are instrumental to point out that moribund manufacturing sector of India do have a potentials to do well, if not become a world-beater. This can eventually address India’s long-time problem of jobless growth and eqality of income. The point it missed is that, it can launch 500 million Indian poors out of poverty, and could potentially create a base for knowledge-based workers in India. The gist of the article goes like this :
For years, analysts dismissed the prospects of India’s manufacturing sector. India had been left behind by the wave of manufacturing off-sourcing that enriched China and Southeast Asia, and critics argued that India’s best hope of catching up with its neighbors lay in the service sector. Those critics are falling silent, however, as 1990s economic reforms finally begin to spur significant growth in Indian industry. Indian manufacturing still falls far short of its potential; the sector is held back especially by infrastructure in far worse shape than China’s, and thus costs that are far higher. McKinsey, however, estimates that the manufacturing sector may quadruple in the next decade. Indians hope that manufacturing end the “jobless growth” that has seen unemployment hold steady even as India’s service sector has globalized, help drag their enormous population out of poverty, and make India an international economic powerhouse. To do that, India will need to enact further free-market reforms and open the country to further foreign direct investment.
You can read the original article here.