Service Vs Manufacturing for mass job creation in India

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muraliravi
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by muraliravi »

subhamoy.das wrote:http://economictimes.indiatimes.com/sli ... 462148.cms

Manufacturing is labor intensive tough job and not for us INDIANs... We rather sit in a cosy office and let our brain power run amock rather than down in that drain with heavy equipment and all. Thank god the CHINESE are here...
Manufacuturing is not about just labor, It is about being smart in design, putting ur brains to develop a chip, a smart engine, process a chemical and on and on. It is about making the right weapons, its about making the right materials and most importantly giving the backbone and R&D to support such manufacturing companies. That is what engineers do and are supposed to do.

Pharma manufacturing for example can be ignored at your own peril for example. The world can hold you ransom on a fine day for a drug that can cure your public. Making generics also is not that answer, its just a start. For a country like India with the size and population, we need everything. The west maybe moved to services after manufacturing, but they still have very rather extremely strong manufacturing base. Name one moderate to high tech item/good that the US does not make. India needs to make its own chips, medicines, gadgets, weapons, engines, heavy equipment, nanotech, speciality chemicals and what not. IT is not the way to go.

India will bypass manufacturing and not grow, it will perish. we will just be a market and one day they will pull the plug on us and we will drown.

India has every potential to be a manufacturer, seller, consumer, all-in-one. At that stage, IT companies can well service solutions for domestic indian companies itself and make them more efficient.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

U are makign the same mistake of clubbing design aspect of manufacturing as a manufacturing job but it is a service job. Manufacturing is limited to factory. Everything else is service. Manufacturing service, healt care service, tourism service etc.. Even construciton is clubbed into service. R&D is clubbed as service. Sales is clubbed at sevice. Transport is a service. Anything that does not produce goods in a factory is a service. So essentailly all steps of a business process - minus the produciton - is a service job. Please read the PDF i posted in one of my posts to under stand the defintion of service.

If u agree to this definition of sevice then INDIA is taking the service route to mass jobs and higher income - again this is a data driven conclusion and not emotional one. Factories will be there in INDIA but they will be for high tech factories and factories that make widgets for local consumption. And service being the high end of the business process and hence it will be more difficult to get and even difficult to move to other countries as it is not about cheap hands but cheap frugal minds which is hard to get.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by VKumar »

Actually, the problem is that in the urban and semi-urban areas it is very difficult to get staff for factory. With retail, call centers and other opportunities, the youngsters do not wish to work in manufacturing jobs. So, its not only that entrepreneurs are reluctant to set up manufacturing factories becuase of the red tape, the green tape, the unions etc but they also don't find enough people of reasonable skill/education level, at affordable pay scale. see what is happening in Maruti & Hero.

Educated Indian youth mainly want to work in airconditioned desk environment. If they cannot get this in India, they will get it overseas.

Manufacturing is going through a tough period!
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by muraliravi »

VKumar wrote:Actually, the problem is that in the urban and semi-urban areas it is very difficult to get staff for factory. With retail, call centers and other opportunities, the youngsters do not wish to work in manufacturing jobs. So, its not only that entrepreneurs are reluctant to set up manufacturing factories becuase of the red tape, the green tape, the unions etc but they also don't find enough people of reasonable skill/education level, at affordable pay scale. see what is happening in Maruti & Hero.

Educated Indian youth mainly want to work in airconditioned desk environment. If they cannot get this in India, they will get it overseas.

Manufacturing is going through a tough period!
You can get a comfortable desk job even in manufacturing as a designer or an engineer. The educated youth does not have to get his hands dirty as an engineer (except maybe if u are field engineer). It is only less educated laborers that have to get their hands dirty. I am sure you will find plenty of them. The problem lies elsewhere. Due to lack of manufacturing job opportunities, the youth of today show no inclination towards learning quality engineering in their 4 yrs of college and they get no gainful and competitive employment as good designers or chemical engineers/scientists. Either those jobs are lacking or they dont pay enuf. Thats the reason why chem/elec/civil/mech engineers go to IT. It starts in yr 1 of college, where they know that they will end up in TCS.

The reasons for the manufacturing sector not employing youth gainfully are in my opinion 2 major issues

1. Capital intensive sector, considering india's red tape and competition from imported goods, with poor infrastructure (power roads), no one is willing to invest, plus the horrible equity situation in the market to get any capital.

2. Indian manufacturing companies traditionally dont invest in R&D to use young smart engineers, they just use technicians to run imported machinery.

Thats the reason you dont see one world class cell phone manufacturer in the nation that has highest number of handsets in the world, thats quite a shame.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

Service includes engineerign service where engineering grads are solving engineering problem assited by computers. All major IT companies have a huge setup of engineering IT-enabled services. But, I think, VKumar has hit the nail on the head by summarizing the DNA of INDIANs and it is this DNA which will make us the number two service GDP in the world, after US, by 2022 or earlier. Personally, I am glad that we are going the US route,where we donot make consumer widgets rather have a strong currency to import them and let the MNC do local production for scale. INDIA should not waste time onthese items but instead should, and is, leap frog into higher value core manufacturing like heavy machines, heavy electricals, aerospace and nuclear electronics, automibiles, laser, nano tech etc...
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by muraliravi »

subhamoy.das wrote:Service includes engineerign service where engineering grads are solving engineering problem assited by computers. All major IT companies have a huge setup of engineering IT-enabled services. But, I think, VKumar has hit the nail on the head by summarizing the DNA of INDIANs and it is this DNA which will make us the number two service GDP in the world, after US, by 2022 or earlier. Personally, I am glad that we are going the US route,where we donot make consumer widgets rather have a strong currency to import them and let the MNC do local production for scale. INDIA should not waste time onthese items but instead should, and is, leap frog into higher value core manufacturing like heavy machines, heavy electricals, aerospace and nuclear electronics, automibiles, laser, nano tech etc...
Your concept is design it here, and get it made elsewhere, thats not going to happen, becos we dont have the human talent pool for that. What will happen with the current model, is limited money flow will come in through IT services, we will export little bit here and there. That money will fuel some domestic services industry to cater to the demand of the people employed in IT and agriculture and to some extent manufacturing. If you want real wealth creation, you need to make stuff yourself and that will benefit services sector also.

My friend,, are u implying that IT companies are providing tools for engineers to work with, that doesn't quite solve the problem. You still need quality engineers to do the design, i am not aware of any IT company that designs bridges. Good luck leap frogging, we haven't put a system where engineers can design a good basic car engine or a nice polymer, and you think, they can make heavy machines and nano tech straight away.

I stick to my point, you don't have human resources to leapfrog, you just don't have enuf quality engg grads or PhD's to help companies make that leap. Have you seen the quality of engineers we churn out. Barring a few elites institutions, do you think these guys can help you sustain advanced technology, I say no way in hell.

Just for a sample, pull out all just graduated civil engineers working in infosys, I bet 98% don't know what a torsional stress is, and you say they will leapfrog and make the next Gen light weight cost effective energy efficient buildings. I am sure you think, they can even make a solar airplane, when we can't even make a photovoltaic cell. All I can say is good luck.

I have seen engineers quit l&t becos they can't handle the work, they were just not good enuf to design a basic structure. Guess where they are now, coding at Infy. 4 years of civil engineering, cannot do basic design, but infy is always there. I assume ur plan is to import Chinese engineers to design roads and bridges.

I know that engineering consulting is a service, but my larger point is that our young generations fancy with IT has depleted us of any engineering skills. When I say engineering, I mean core engineering.

More importantly, the topic is about mass job creation, no way services can employ the bulk of indian population. To employ a nation of 1.2 bn, you need to do the low level manufacturing also. The money has to flow from somewhere to sustain the services and the population, you need to make something that you can sell to the world, just lines of code will not do it. Leapfrogging is a way out, but as i said before, its near impossible, and even if u can, it will 100 yrs before you can leapfrog ahead of others who are ahead now.

Improve the human talent pool, improve r&d, start making stuff locally and be competitive to sell into the world. Reduce number of engineering colleges and replace with fewer but quality universities with all departments. Our 17 yr olds deserve better, they need to learn quality stuff in depth to replicate it in practical environment. In the process you will come up with some leapfrog tech here and there becos you have started putting a system in place to sustain that leapfrog. You cannot all of sudden compete with boeing in the aerospace market when you have 10 colleges which have aerospace departments, and just a handful of factory workers who have any meaningful experience in that sector. Worse you have no competency in any supporting aviation equipment. Empty castle building all this leapfrogging is, you have to take the long route and build a base, no country has ever done it and India will not be an exception.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

A lot of people donot belive in this theory, like u. To all of them I would say that ground realities of today and the projections for future does not correlate with your views. Today INDIA has a 2.5T service GDP and ranks third in the world and is growing at 10% a clip and accounts for 25% of the jobs. It is only a matter of a decade that we reach 6T service economy and be second in the world just behind the US. Some thing is working down below inspite of these so-called limitations about quality of graduates, service not produces wealth, service cannot create jobs......
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by muraliravi »

subhamoy.das wrote:A lot of people donot belive in this theory, like u. To all of them I would say that ground realities of today and the projections for future does not correlate with your views. Today INDIA has a 2.5T service GDP and ranks third in the world and is growing at 10% a clip and accounts for 25% of the jobs. It is only a matter of a decade that we reach 6T service economy and be second in the world just behind the US. Some thing is working down below inspite of these so-called limitations about quality of graduates, service not produces wealth, service cannot create jobs......
Yah rite, we cant make our own cell phones and we will beat all the developed nations by using the so called service dna. Hurray, lets party. Dude get real, what matters at the end of the day is gdp(ppp) per capita. Not just gdp(ppp). Uttar pradesh also has gdp on par with tamil nadu, is quality of life in both states or development indicators the same. With thrice more population than TN, with same gdp whats the purpose.

Get out of your cuckoo world. We need to go back to the drawing board and fix the system (educational and industry focus) before we can start dreaming
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by SBajwa »

The problems that I see are

1. Too many people are employed in agriculture sector that implies that our agricultural labor is not only illiterate but not productive enough or comparable with the world.

2. Too few people are moving from Agriculture to Manufacturing. Most of the people who get educated in villages move into services sector (doctors, engineers, government jobs)

The education at primary level is totally messed up in villages! The teachers themselves are not educated enough to teach children the practical things like driving, typing, public speaking, safely operating electrical equipment, agricultural stuff, medical stuff, etc. Most of these skills/values that Indians learn are from the street i.e. "Street Smartness"

Ideal will be to have at least

Only 10-15% of the population depending upon agriculture (grain, produce, milk, eggs, meat) as livelihood.
20-35% of the population depending upon manufacturing (food items, consumer items, defense items, capital items)
15-20% of the population to be engineers, doctors, Babus, police, store keepers, merchants.
10% to be in sports, journalism, movies and other such professions.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

muraliravi wrote:
subhamoy.das wrote:A lot of people donot belive in this theory, like u. To all of them I would say that ground realities of today and the projections for future does not correlate with your views. Today INDIA has a 2.5T service GDP and ranks third in the world and is growing at 10% a clip and accounts for 25% of the jobs. It is only a matter of a decade that we reach 6T service economy and be second in the world just behind the US. Some thing is working down below inspite of these so-called limitations about quality of graduates, service not produces wealth, service cannot create jobs......
Yah rite, we cant make our own cell phones and we will beat all the developed nations by using the so called service dna. Hurray, lets party. Dude get real, what matters at the end of the day is gdp(ppp) per capita. Not just gdp(ppp). Uttar pradesh also has gdp on par with tamil nadu, is quality of life in both states or development indicators the same. With thrice more population than TN, with same gdp whats the purpose.

Get out of your cuckoo world. We need to go back to the drawing board and fix the system (educational and industry focus) before we can start dreaming
When u say "beating the developed nation" i assume u mean to beat them in their per capita wealth. India or CHINA with such a huge population will never be able to reach a 40,000 per capita GDP but a realistic figure would be around 10,000 - 8,000 which will earn us a place in the middle income group. Right now INDIA's per capita is about 3500. So a all we need to do is reach a 10T PPP GDP while keeping the population under control in the next decade which means that by next deacde service GDP should be aound 6T to make this happen. I have given u enough data points now to prove that service GDP will lead us to a a middle income country in next decade. Can u please post some data points to the contrary rather than be emotinonal about manufacturing.

Regarding making phones, I would say that let the experts make the phones and we focus on our expertise. Take the US. By your logic, since US does not make any phones or that matter TV, it is a looser ........Or for that matter france, germany, italy. None is known as non-car consumer durable giants so they are looser? They manufacture high end items like automobiles, machineries, turbines, generators etc and so does INDIA......
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

Look at this http://www.mapi.net/china-largest-manufacturer-world

There is a indicator called Valued Manufacturing per capita ( MPC )

We will see that it has a very very strong correlation with the per capita GDP and MPC. See how CHINA, being the number 1 manufacturer, has a very low MPC and hence poor. INDIA is a blip in that rudder. There is no way that countries of size of INDIA and CHINA can do so much manufacturing that their MPC can reach the levels of rich nations of much smaller size. In other words, manufacturing the way to prosperity is not going to happen in a country of size CHINA and INDIA.

Service steps in here.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

SBajwa wrote:The problems that I see are

Only 10-15% of the population depending upon agriculture (grain, produce, milk, eggs, meat) as livelihood.
20-35% of the population depending upon manufacturing (food items, consumer items, defense items, capital items)
15-20% of the population to be engineers, doctors, Babus, police, store keepers, merchants.
10% to be in sports, journalism, movies and other such professions.
The last part is actally part of service.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by muraliravi »

subhamoy.das wrote: When u say "beating the developed nation" i assume u mean to beat them in their per capita wealth. India or CHINA with such a huge population will never be able to reach a 40,000 per capita GDP but a realistic figure would be around 10,000 - 8,000 which will earn us a place in the middle income group. Right now INDIA's per capita is about 3500. So a all we need to do is reach a 10T PPP GDP while keeping the population under control in the next decade which means that by next deacde service GDP should be aound 6T to make this happen. I have given u enough data points now to prove that service GDP will lead us to a a middle income country in next decade. Can u please post some data points to the contrary rather than be emotinonal about manufacturing.

Regarding making phones, I would say that let the experts make the phones and we focus on our expertise. Take the US. By your logic, since US does not make any phones or that matter TV, it is a looser ........Or for that matter france, germany, italy. None is known as non-car consumer durable giants so they are looser? They manufacture high end items like automobiles, machineries, turbines, generators etc and so does INDIA......
Really when did India start making these. We assemble these, we dont make them. At least not the important components. The US and Europe make a lot of high end stuff. We dont make much from scratch. We may assemble a few. As i said in my previous post, the talent pool to make high end stuff in india is in deficit. By the way i thought the US did make iphones (designed and developed in california, assembled in china). Sweden does make nokia. Philips, Vizio, Westinghouse all major tv brands made in the US.

Now lets address your larger question.

When you plan to make a stable economy, look at like a portfolio or a building. It has to be stable and well diversified. You cannot rely on one source of wealth creation to run your economy. The so called services sector that you talk about needs a wealth creator. So what are the wealth creators of the society? That is what you need to identify. Most of the services that you talk about barring IT/Financial services are not wealth creators. The rest of services sectors (healthcare, tourism, travel, media) all of them are survive based on the wealth created by a small portion of the service sector (namely IT/financial services) and from the other wealth creators like manufacturing and agriculture. So wealth creators come at the base of the pyramid and these ancillary sectors which contribute to the gdp survive based on the strength of the wealth creators. I have to be careful here, domestic sales of IT/manufacturing/agro stuff can be called wealth creators only if they balance out well enough.

So essentially the base is quite weak, if you dont have a solid manufacturing piece in it. Remember, your base has to be well diversified. With growing inflation your 6T (ppp) services based economy will not be a great number to push india to the next level. That is just not enough wealth. Keep in mind with growing inflation your adjusted ppp will not look great as they do now. Anyway that is another discussion. The bottom line is, it does not matter how big ur service gdp is, what matters is how much of the 6T comes from real wealth creation. Because the thinner ur wealth creation base is, the riskier ur portfolio is. The market size for services which are wealth creators is just not that huge for you to have diversified portfolio. So tomorrow if this thin piece moves out of india, the entire ancillary services based on this wealth will collapse. In manufacturing, you can have a quite diverse base, as the market is huge. Portfolio gets less risky. Plus if you manufacture urself, prices are competitive locally giving us a higher buying power. Just as a data point, i believe IT, financial services and other wealth creators in the services sector form just 15-20% of the services sector, so just roughly 8-11% of gdp. Even construction as a service is just ancillary service based on construction needs of the moneyholders or the tax base of a govt for infrastructure projects. And tax is based out of wealth created. The manufacturing of construction goods is a different story altogether.

Anyway my reply has not been very coherent due to lack of time. Save that for some other time.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by Theo_Fidel »

Not to jump in here but murali maybe missing the point.

First there will be no low level manufacturing in India. It worked for a while in China because you could get college level talent at manual labor wages. It does not even work there anymore. Waiting for manufacturing to absorb our illiterate farm worker is a futile exercise. Never going to to happen. For world class manufacturing even at lowest levels we need at 12th pass with a 75% type score. Anything below is not going to be manufacturing squat.

What India can do, I'd call for lack of a better is service based manufacturing. Maybe white color manufacturing. AFAIK car manufacturing at least in Chennai ALL the components barring a few of the electronic pieces are made in India. All are manufactured to world quality using engineering graduate type help. This is the type of manufacturing we are going to succeed in.

AFA the illiterate laborer, who is going to hire him you ask. I don't know. Certainly no manufacturer worth his salt.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

murali: there is no need to be so emotional about manufacturing. This thread is about putting jobs in the hands of the INDIAN workers. Manufacturing will not do that. Period. Agri better not do that. Service is doing it and will do it in future. Please post data to prove other wise.

You seem to correlate wealth creation to per capita GDP to manufacturing. Well that could be the route countries - with sub-million poplutation - took centuries ago. A number of folks hold the same view. But if u look at the PCM indicator i posted above, which correalte 100% with wealth creation, u will see where CHINA with all its factories stand. INDIA is blip in that indictor map jus showing up as a dot. Even if INDIA puts factories in nook and corner, it will still probably not reach the CHINA level, forhet west level, but mind u the days of contract manufacturing is coming to end now. If u are dreaming of INDIA coming out of products of its own and then flooding the world with and become rich that will also not happen. So manufacturing based wealth creation of the order of west will simply not happen in INDIA. U like it or not.

That leave us at the door of service for job and wealth creation. When INDIA has a 6T service GDP vs a 2T manufacturing GDP and a 2T agi GDP in next 10 years which sector will drive jobs and in the driver seat of the economy ? No points for guessing that.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

Here is some interesting comparison of the brick countries around their consumption levels

http://www.globalsherpa.org/wp-content/ ... A4_G14.gif

See the small difference between the manufacturing power house and INDIA. Very little difference. So again a pointer to the fact that mad manufacturing has been a waste in creating well paid jobs which drives consumption and economy. CHINA purchases 37% of what it produces while INDIA purchases 60% of what it produces. So much for manufacturing your way to wealth creation.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

See here http://en.wikipedia.org/wiki/List_of_co ... per_capita

China's consumption is ppp dollar 2,200 while INDIA at ppp dollar 1750. Again a pointer that mad manufacturing did not pay much in the end and that service is doing a fine job as driver of jobs and consumption and economy.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

http://economictimes.indiatimes.com/tec ... 664964.cms

How indian service should be reaching the next 100b.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by VKumar »

To increase the share of manufacturing, I think the following are a must:

1. 24hrs of clean power. At present many units are facing power outage or using expensive generator.

2. Simple labour laws for MSME sector. The labour laws must be based on the Capital Invested rather than on number of employees. A small company has to cope with the same laws as a large company and obviously this means that the entrepreneurs time is unduly spent on paperwork. This will also reduce the inspector raj

3. Infrastructure to ensure cheap & reliable transportation for finished goods as well as raw material.

4. Availability of bank loans with lower interest rates and collateral requirements.

5. Simplified Excise rules for MSME. A major part of the inspector raj.

6. Simplified VAT rules for MSME.

7. Slab based I.T. (like for individuals). MSME are almost the same as PROPRIETORSHIP or PARTNERSHIP.




I am plugging for MSME because for a smaller investment the small sector employs many more persons.

Lets start with the above and review the progress.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

What will these SME make, will there consumers be in INDIA or outside, how many jobs will each one create and what level of education/skill will be required to fill these SME factories?
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by Prem »

For Manufacturing Jobs:- ? Japani will start soon in proposed Industrail Corridors.
http://www.reuters.com/article/2013/03/ ... 2Q20130302
Exclusive: Jaguar Land Rover studying full production in India - sources
(Reuters) - Jaguar Land Rover (JLR) is investigating the potential of manufacturing cars in India, company sources said, as the British luxury carmaker looks to build on its growth in emerging markets with the help of Indian parent Tata Motors.JLR, which has ridden a wave of surging demand in China and other emerging markets to post record profits over the past year, is "actively exploring the possibility" of building cars from scratch in India, said one company source."The idea is being looked into, with the (Jaguar) XF and (Land Rover) Freelander the obvious candidates," said another source with knowledge of the matter.The British brands, which already assemble two models in India using parts and engines shipped from factories in the UK, will also begin assembling its popular Range Rover Evoque in the country soon, the first source said without providing details.Building cars in India, which has developed into an emerging market export hub for many global carmakers, would allow JLR to skirt high import taxes on luxury cars, which the country's finance minister proposed raising to100 percent from 75 percent in his budget speech last week."Jaguar Land Rover has ambitious plans to expand its manufacturing footprint and increase production in markets outside Britain," Del Sehmar, a Mumbai-based spokesman for the company, told Reuters. "We continue to examine options to expand our range of locally assembled products," he said, referring to India.LR will exhibit a new 9-speed automatic Evoque and an electric-powered version of its Land Rover Defender at the Geneva Motor Show next week
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by AbhiJ »

Inclusive Growth: Impossible without Manufacturing

The Best article I have seen so far.

All data backed by up by sources.

It shows How BJP created the Entire Manufacturing Eco-System Plan and Proper Implementation which was Raped completely with NREGAs, FSBs powered by NAC!
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by AbhiJ »

Sagar Mala Project
ON August 15, 2003, Prime Minister Atal Bihari Vajpayee announced an ambitious plan christened `Sagar Mala', a la the national highway development programme, for the development of India's maritime sector. The project proposes to cover all areas of maritime transport, including ports, shipping and inland waterways, and is aimed at realising the potential of trade.

According to Shipping Minister Shatrughan Sinha,"Sagar Mala will not only encompass the seas of the subcontinent but will have glittering ports connected to vibrant inland waterways." He said India had been a leading maritime nation, but over the years its position on the maritime map had slumped. "Sagar Mala offers a golden opportunity to compete successfully with the best of the maritime world," he said. The project assumes significance as India strives to raise its share in the global trade, currently pegged at 0.67 per cent, to at least 1 per cent by 2007. In absolute terms, this would translate into adding around Rs.180,000 crores a year of international trade within the next four years. Besides, the Tenth Plan has targeted an 8 per cent growth in the gross domestic product (GDP). At present, about 90 per cent of India's international trade by volume and 70 per cent by value are carried through its ports.

Sagar Mala will lay emphasis on developing India's ports to levels comparable with the best global ports in terms of infrastructure, efficiency and quality of service, increasing the tonnage capacity, upgrading and creating ship-building and ship repair facilities and increasing the use of inland waterways for transportation.

The project envisages the setting up of new ports along the coastline where required draft is available. The Centre along with the State governments will create basic facilities at these ports and offer them to the private sector for further development and operation.

In order to cater to the anticipated increase in maritime traffic, which is likely to touch 565 million tonnes by 2006-07 as against the actual traffic of 412 mt handled in 2002-03, existing ports are planned to be upgraded by deepening the harbours, creating additional capacity, and modernising cargo handling equipment.

The government plans to develop a world-class container trans-shipment port at Vallarpadam in Kochi, in view of its proximity to the international sea route, in order to attract trans-shipment cargo. The Jawaharlal Nehru Port Trust and the Chennai Port Trust will be upgraded to make them hub ports.

These initiatives will enable bigger mainline vessels to call at Indian ports resulting in faster and economic movement of Indian cargo. At select ports, additional facilities will be created for the export of iron ore.

Under Sagar Mala, all major ports will be connected with the Golden Quadrilateral through high-speed expressways. The rail connectivity to such ports will also be strengthened so that adequate line capacity and speed of movement are available. A big chunk of the total project cost of more than Rs.100,000 crores is expected to come from the private sector through foreign direct investment (FDI) in ports and other related activities. New projects will be offered for private investment at major ports with a view to improving efficiency and increasing productivity and competitiveness.

Yet another feature of Sagar Mala is that it seeks to promote commodity-based transportation whereby a commodity moves by the most efficient mode of transport.

Shatrughan Sinha said that the transport sector had a strategic importance in the Indian economy as it underpinned the activities in other sectors and also affected the competitiveness of EXIM trade. "It is therefore important that cost-effective transportation solutions are offered to customers. Keeping this in view, our endeavour will be to aim at commodity-based transportation planning whereby a commodity moves by the most efficient mode of transport. This will require the development of adequate infrastructure for different modes, particularly inland waterways and coastal shipping," he explained.

To drive home this point, the Minister illustrated the benefit of cargo movement by inland water transport. One litre of fuel moves 24 tonne kilometres by road, 85 tonne km by rail and 105 tonne km by inland water transport (IWT). The present inland transport quantum is of the order of 1,000 billion tonne km.

Out of this, IWT carries hardly 1.5 billion tonne km or 0.15 per cent of the total transport of the country. "If 20 billion tonne km or 2 per cent of the cargo is shifted from road to IWT, it will correspond to a saving of 6.44 lakh kilo litres of fuel or Rs.1,200 crores. The shift in cargo to the IWT mode would also result in benefits to the environment and enable increased economic activities in areas along the waterways," he observed.

In fact, the government plans to create a separate fund for the development of coastal shipping/IWT infrastructure.

The Shipping Ministry would provide the right fiscal environment for the shipping industry to increase tonnage, which includes the introduction of tonnage tax and the rationalisation of seafarer's taxation.

The presence of Indian seafarers, an important source of invisible earnings for the country, in the global market would be further strengthened. Through marketing efforts, the employment of Indian seafarers on foreign going vessels would be increased. Simultaneously, through policy initiatives, training of seafarers would be enhanced by encouraging the private sector to open state-of-the-art training institutes.

Considering the immediate and long-term benefits likely to accrue to trade and industry, part of the finances for implementing the project is proposed to be raised through a nominal maritime development cess for a period of 10 years on cargo passing through Indian ports.

This cess, which is proposed to be credited to the Consolidated Fund of India, will be administered by the Ministry of Finance for the exclusive purpose of funding Sagar Mala. The Shipping Ministry was not able to secure Cabinet approval for the project before the Lok Sabha was dissolved on February 6. Now it has to wait until a new government is formed. :((
subhamoy.das
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

Why blame UPA. Blame Bharat who wants to live on agriculture, donot pay taxes and live of subsidy from taxes paid by India. It is this Bharat which gave the mandate to UPA. I am keeping my fingurs crossed for 2014. India having high value manufacturing - not consumer widgets - accounting for 25% of GDP and jobs should be a good point to reach.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by VKumar »

Dear Mr. Das,

Please google 'Role of SME in India" or something such and all the questions will be answered.

I believe 85% of people in the manufacturing sector are employed in sme. SME produce almost everything - or at least a very diversified range.

Everybody buys sme products.

Just that msme sector needs some rational support.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by AbhiJ »

Large MNCs have Core Technology and Processes. Rest parts are just purchased from SMEs.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

Infosys bags BMW contract for infra management services

http://economictimes.indiatimes.com/tec ... 969686.cms
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by svinayak »

subhamoy.das wrote:http://www.samachar.com/India-is-a-cont ... ddjcc.html

India is the content power house
Why is the foriegn media companies controlling the distribution world wide.
Why cant media groups inside India control the distribution of Indian content world wide and create channels worldwide.

A friends maiden attempt to create a desi studio has faltered.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by chola »

subhamoy.das wrote:Why blame UPA. Blame Bharat who wants to live on agriculture, donot pay taxes and live of subsidy from taxes paid by India.
No one wants to to live on agriculture. You need an economy to provide them with the proper employment and that cannot be created without going into the secondary sector of manufacturing or production of "widgets" as you call it.

A tertiary sector such as services is dependent on a primary or secondary sector and your shiny new IT/BPO industry is entirely dependent on work from the manufacturing sectors in the US/UK. As long as the goras are willing parcel out work to Bangalore we will have a few million employed. If and when they are unhappy with the lost of jobs and pass legislation to cut this work, Bangalore will be stopped dead in its tracks because it cannot be sustained. Unlike Mahindra or BHEL, Wipro cannot support itself in India.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by ArmenT »

^^^^
I've always wondered, what is the percentage share of Indian clients vs. non-Indian clients for InfoSys, Wipro, Sathyam et. al Any one have any figures like # of clients or income percentage breakdowns?
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by member_20292 »

chola wrote:
subhamoy.das wrote:Why blame UPA. Blame Bharat who wants to live on agriculture, donot pay taxes and live of subsidy from taxes paid by India.
Unlike Mahindra or BHEL, Wipro cannot support itself in India.

Chola ji. From the trenches of Indian IT, I will say that much of our clients are local based. Much of them.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by member_20292 »

subhamoy.das wrote:Why blame UPA. Blame Bharat who wants to live on agriculture, donot pay taxes and live of subsidy from taxes paid by India. It is this Bharat which gave the mandate to UPA. I am keeping my fingurs crossed for 2014. India having high value manufacturing - not consumer widgets - accounting for 25% of GDP and jobs should be a good point to reach.

Haha.

In my office. There is a educated guy with an MCA degree from Bihar. The socialist meme is so ingrained in our DNA...that he says..."yes, Bihar should be made special status as per Nitish".

Don't blame the politicians. Blame the citizens of India....rightfully or wrongfully...they stay where they are.....avoid educating themselves, love taking dole and discounts.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by Sachin »

mahadevbhu wrote:Chola ji. From the trenches of Indian IT, I will say that much of our clients are local based. Much of them.
Is there a kind of percentage which we can have? How much of IT work for non-India clients and how much for Indian clients? Vegetable Oil.Co does have an Indian (and also Gelf) focused wing known as Infotech. TCS also has good India Govt. projects. But do you think these companies can survive at the same rate (and employee strength) if they have only India based project. These companies may still run, but not with so many people. My gut feel is that many IT-Vity Cos are still looking at the West to some how get the maximum money from there, before those folks get wiser and stops/reduces out sourcing.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

chola wrote:
subhamoy.das wrote:Why blame UPA. Blame Bharat who wants to live on agriculture, donot pay taxes and live of subsidy from taxes paid by India.
No one wants to to live on agriculture. You need an economy to provide them with the proper employment and that cannot be created without going into the secondary sector of manufacturing or production of "widgets" as you call it.

A tertiary sector such as services is dependent on a primary or secondary sector and your shiny new IT/BPO industry is entirely dependent on work from the manufacturing sectors in the US/UK. As long as the goras are willing parcel out work to Bangalore we will have a few million employed. If and when they are unhappy with the lost of jobs and pass legislation to cut this work, Bangalore will be stopped dead in its tracks because it cannot be sustained. Unlike Mahindra or BHEL, Wipro cannot support itself in India.
And guess whom are these secondary folks selling there widgets to - from planes to automobiles to cell phones - to the poor tertiary service folks in India and if they cut the service jobs they will be shooting in their foot and that is why they will never do it or else they would have done it long ago!.

The demand is being created by the service jobs my dear friend all widget manufactures are making a bealien to the service giant. The other day i say CHINESE widget makers crawling deep inside metro holes on Bangalore.....
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

http://economictimes.indiatimes.com/sli ... 090793.cms

Cannot believe these images. A service driven economy building these kind of things.
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by SriKumar »

subhamoy.das wrote:http://economictimes.indiatimes.com/sli ... 090793.cms
Cannot believe these images. A service driven economy building these kind of things.
A minor point...a service driven economy, per your logic, will be paying for these kinds of things (as the customer) and not building them. The building activity, being a dirty industry involving digging holes and sometimes crawling in dirt, will be left to others to perform (as the vendor)
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Re: Service Vs Manufacturing for mass job creation in INDA

Post by subhamoy.das »

SriKumar wrote:
subhamoy.das wrote:http://economictimes.indiatimes.com/sli ... 090793.cms
Cannot believe these images. A service driven economy building these kind of things.
A minor point...a service driven economy, per your logic, will be paying for these kinds of things (as the customer) and not building them. The building activity, being a dirty industry involving digging holes and sometimes crawling in dirt, will be left to others to perform (as the vendor)
I stand corrected.....Once built , the service indutry will then use this to earn mega bucks and create lots of jobs.....but the manufacturing folks will then be sitting idle for the next airport to be put on the block by the service........In fact, buildign is considered in service sector only. So it is all service jobs here and small amount of manufacturing jobs to help machines produce the widgets....
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