They say that every crisis brings with itself an opportunity. Likewise, the Covid-19 pandemic brought with itself an opportunity for India, that was identified and announced by the Prime Minister of India as ‘Atmanirbhar Bharat’ or making India self-reliant. When ‘Make in India’ as a concept was announced in 2014, it was successful in igniting the idea and now is an opportune time to execute that idea. But, what does ‘Atmanirbhar Bharat’ really mean? What does it imply for the future? More so, what does it mean for the MSME sector and how the sector can leverage it?
The MSME sector is the most vibrant and dynamic industrial sector contributing about 40 per cent to the GDP and significantly to the exports of the country. Multiple government policies and decisions emphasize that the MSME sector will act as the bedrock for economic revival. The idea behind ‘Make in India’ is about decentralised localism that takes pride in indigenous brands, emphasises resilience and adaptability, and encourages local capacity-building and employability. This will encourage the idea of making in India for the MSME industry and help amplify their presence across sectors.
The MSME sector in India is second largest to agriculture with high employment and contribution in terms of foreign exchange earnings, the sector has established its significance in the macroeconomic value chain. It is only fair for us to now unleash the potential of this sector by leveraging the ‘Make in India’ concept and help this sector thrive post the Covid-19 pandemic. As per a recent survey done by Prione, about 23 per cent of MSME have indicated that working capital has been a primary concern, making it difficult for them to sustain or restart their businesses. In order to relieve the MSME sector from the current distress caused by the pandemic, the government has rolled out stimulus packages Such as the Fund of Funds. This scheme is intended to help MSMEs tackle the shortage of growth capital and revenue across verticals. Further, this aid will help the sector address immediate needs with regards to operations and logistics, thereby offering an opportunity to revive business. Most of the industries have been affected due to the current pandemic and are struggling to stay afloat. The ‘Make in India’ 2.0 has been announced at an opportune time especially for the currently struggling MSME sector. The narrative around Make in India has been going on for over five years now, however, this is the first time that the idea has been backed with a concrete plan, supply of funds and required resources to be able to march towards making India self-reliant. With the conversations gaining momentum, it is an opportunity for the MSME sector to capitalize on the ‘Make in India’ bandwagon and catch on with zeal. There is ample scope for the MSME sector to identify areas for local production of goods right from raw material to the finished product. Estimates indicate that a third of the Chinese imports comprise of low-tech goods that were earlier made by Indians, or are still being made locally but in smaller quantities due to higher costs leading to decrease in demand. With the current push for ‘Make in India’, MSMEs can utilize the economies of scale and place these products at competitive costs thus increasing the demand for locally produced goods. Efforts in this direction will prove to be a fillip for the hundreds of small and medium firms, which have suffered due to a decrease in demand. Along with this, what is also important is inter-industry and inter organisation support. While the government is trying and doing its best to aid the sector, partnerships from large organizations will go a long way in providing support to the sector. Having said that, the ‘Make in India’ strategy has been adopted by the Prime Minister to facilitate investment, foster innovation, enhance skill development, encourage employment, and build a sustainable eco-system for the MSME sector in India. The sector should now leverage the opportunity created by the various partners in the industry and capitalise on the opportunity to make themselves self-reliant. It can revive itself by understanding the current operations of the ecosystem, and pool in the necessary resources available right now. Post that, MSMEs can create a long-term plan based on the available data and build a sustainable business so as to survive any obstacle or crisis in the long run. Making in India and supporting those who ‘Make in India’ can build and boost the economy and place us closer to the idea of an Atmanirbhar Bharat.