The Indian prime minister is very positive on Indian economy and he should be. We are a country of young people. Our average age is around 25. We have young people who are willing to achieve big things and thus trying to push Indian economy ahead.
Purchasing power of India is on rise and this excites the foreign investors.
Narendra Modi, the prime minister of India launched a very ambitious scheme "Make in India."
He wants to see a change in Indian economy through encouraging manufacturing. We have done good in service sector and are still doing good in service sector.
But, I doubt that we will be ever able to deliver what our Prime minister expects from us. I doubt because there is lot of difference between thinking and really doing.
There is difference between actions and theories. First question, Why India performed very well in service sector. A large part of our GDP is from service sector.
Here are my reasons why Make in India will never be successful:
- License RAAJ and Inspectors: If you believe that India is liberalized and is no more a controlled economy, you have to think again. Let’s have a look at different registration we require for starting a manufacturing business. We need Excise, VAT among others. In states like Karnataka, its a nightmare to get VAT registration. Inspections are still done!!!
How can we start manufacturing in India, when we are tortured by system. A system on which we have to depend, even to start business. Why registrations are not made simple.
- Red tapes and favoritisms: Still we are depended on favoritisms, if you have one your favorites at government departments work gets faster.
- Apply online take printouts and post: So India is going online, everything is online but you have to take printouts and post it to departments. It is like Keyboard has replaced Pen and Paper, everything else is same. We are still in 1980 compared to USA or other developed countries.
- Submit documents, Submit more documents: This is what happening in India. To register a company you need to submit same set of documents to same department, many times. To start a business in another state, you have to prove that you are citizen of this country. Why differentiation is made among citizens in different states.
- Taxes: Taxes, in India taxes kill your business even before you start it. A person with 1,00,000 can never start business legally in India. VAT registration and other registration will take away 50%. Any profit made, Income tax will take away.
- SEBI, RBI, FEMA, Money Laundering and many acts: For one thing you have to take permission from different government wings. Again, go to point 4. Even consultants are not sure whom to contact for which permission.
I know, the contents of this article may look negative but this is TRUTH.
Make In India is sure to fail unless we change our system. Government start treating its citizens as honest and remove all unnecessary laws that puts difficulties.
As a country our government is more concerned about GDP, Fiscal Deficit but not about ease of doing business.
We have seen budget 2015, we had huge expectations from finance minister. Budget 2015 is a disaster that happened to India.
Only good thing was abolition of Wealth Tax, other than this nothing was substantial for betterment of country.
Who is interested in GDP numbers when ground realities are not at all favorable for your plans? You plan to make India a manufacturing Hub with complex laws and uncertainties in system.
The time has come when finance minister has to think above GDP numbers and fiscal deficit. A fake growth story can shine your image among foreign investors but cannot change the truth.
We are failed nation, yes completely failed nation. It is not a good time to blame Congress for this. You have huge majority, you can change any law. You can simplify laws at center and states in which your party has government.
This is the time when you have to think above Ambani and Adani.
Posted 2 years, 6 months ago by Rahul Rai
We had big hopes from this government. But seems the present government is another government with tough talks and zero actions.
Budget was very bad. You have schemes, lot of schemes. But where is money to invest.
Finance minister wants gold to be converted in bonds, but do not want to tax treatment. Once you convert gold to bonds, income tax department will be at your home.
We are suffering from the time of independence, this mixed economy will not take us anywhere. We have to either follow capitalist model and implement communist economy policies.
Posted 2 years, 6 months ago by Prakash mehta
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