Subject: Economy

Answer:

The transformative potential of Make in India initiative to establish India as a global manufacturing hub is intrinsically linked to the availability of skilled workforce and flexible labor markets. The synergy between manufacturing prowess and human capital development becomes crucial as India aims to increase the manufacturing sector's contribution to GDP from 17% to 25%.

Interdependence of Make in India and Skill India

• Skill-Industry Alignment: The success of manufacturing depends on bridging the skill gap through initiatives like National Apprenticeship Promotion Scheme (NAPS), which has engaged over 43.47 lakh apprentices across 36 states/UTs.

• Workforce Readiness: The increase in formally vocationally trained individuals from 2% to 3.7% (2017-18 to 2022-23) demonstrates progress, yet highlights the need for accelerated skill development.

• Industry 4.0 Preparedness: Programs like Pradhan Mantri Kaushal Vikas Yojana (PMKVY) are crucial for preparing workers for advanced manufacturing technologies.

Need for Labour Reforms

• Regulatory Simplification: The consolidation of 29 labor laws into four labor codes has streamlined compliance procedures, making it easier for manufacturers to operate.

• Social Security Enhancement: New labor codes extend protection to gig workers and ensure minimum wage guarantees, creating a more stable workforce.

• Industrial Relations: Reformed labor laws facilitate easier hiring and operational flexibility, attracting greater manufacturing investments.

Impact on Make in India

• FDI Growth: Labor reforms and skill development have contributed to a 69% increase in FDI equity inflow in manufacturing (US$165.1 billion between 2014-2024).

• Employment Generation: The rise in employment rates from 36.9% to 37.9% (December 2020 to January 2021) indicates positive momentum, though challenges remain.

• Female Participation: 20% female participation in PM-NAPS reflects growing inclusivity in the manufacturing sector.

The symbiotic relationship between Make in India, Skill India, and labor reforms is evident in transforming India's manufacturing landscape. Success stories like Samsung's largest mobile factory in Noida and Apple's iPhone manufacturing demonstrate the potential when skilled workforce meets reformed labor markets. The way forward lies in strengthening this trinity through continued focus on industry-relevant skill development, labor market flexibility, and manufacturing competitiveness.