Indian capital goods sector is not suffering from poor intentions to grow but from practical disabilities, says Expert

New Delhi, May 25 (KNN) To achieve the target aimed through the National Capital Goods Policy, there is an urgent need to put in place Acts and Schemes to “realize” such ideas, says an expert.

The Union Cabinet today gave its approval for National Capital Goods Policy. The policy also aims to facilitate improvement in technology depth across sub-sectors, increase skill availability, ensure mandatory standards and promote growth and capacity building of MSMEs. 

This is first ever policy for Capital Goods sector with a clear objective of increasing production of capital goods from Rs.2,30,000 crore in 2014-15 to Rs.7,50,000 crore in 2025 and raising direct and indirect employment from the current 8.4 million to 30 million.

The policy envisages increasing exports from the current 27 percent to 40 percent of production. It will increase the share of domestic production in India’s demand from 60 percent to 80 percent thus making India a net exporter of capital goods.

“While the capital good policy talks of very lofty idea of three times increase in turnover of the domestic capital goods sector, in 10 years, it needs to quickly put in place Acts and schemes to realize such ideas,” said Debashis Bandhopadhyay, Policy Director, FISME.

The Indian capital good sector is not suffering from poor intentions to grow but from practical disabilities like low technology level, uneven competition from global exporters access to domestic market, largely dominated by PSUs, he added.

He said that the sector with large number of MSME players, need handholding through access to technology, availability of cheap project finance etc. Let us hope Government will put all efforts to materialise its vision.

The idea of a ‘National Capital Goods Policy’ was first presented by the Department of Heavy Industry to the Prime Minister in the ‘Make in India’ workshop held in December, 2014. The policy has been finalized after extensive stakeholder consultations with industry, academia, different ministries etc. (KNN Bureau)