MAKE IN INDIA
In September of 2014, India’s Prime Minister Narendra Modi gathered a plethora of business leaders,
diplomats, journalists and other government officials to launch their Make in India campaign. The main emphasis
was to explain why India MUST create industrial manufacturing jobs. India’s ever growing population (1.2 B±)
requires 1M± new jobs per month. (Time to Make in India? The Economist, 9/25/14.) Reliance Industries Limited’s
chairman, Mukesh Ambani said that if the right conditions were created, India’s economy could grow at a
sustained rate of 8-10%, per year for an extended period of time.
The aforementioned “right conditions” are numerous. Prime Minister Modi highlighted the need for India’s
youth to be better prepared for globally competitive jobs (which would call for a total overhaul of India’s educational system);
a vastly improved infrastructure; and reforming the oppressive rules that make India anti-biz. (India ranked 134th on
the World Bank’s annual “Ease of doing Biz” list. Singapore was 1
st & the US ranked 7
.) Anti-business rules include such things
as a foreign ownership cap (which states that NO foreigner may have a controlling stake [50 %+] in any jointly owned company).
There also are severe limits on the amount of foreign capital permitted in many business sectors.
Mr. Modi appears to have had some modest success as India is now #130 on The World Bank’s 2016 list.
Foreign direct investment b/t Oct-May grew by 40% over the previous year and India’s industrial production rose
2.7% vs 0.6% last yr. Manufacturing giant Foxconn announced plans to spend $5B on factories and on
research & development AND GM is investing another $1B in India (WSJ, 8/12/15). WOW!
Under Prime Minister Modi, India has overtaken China as the region’s economic growth leader according to
Standard & Poor’s. China is now experiencing its slowest growth (GDP is growing at 7%) in over 25 yrs. As a
result it is starting its own campaign, Made in China 2025. The program will use subsidies and mandates to get
manufacturers to upgrade their factories. Consulting firm Bain says that China’s short term goals are to “improve
quality, productivity and digitization AND to expand the use of numerically controlled machines.” (Still Made in China,
The Economist, 9/12/15.) The plan has lofty goals including the creation of 15 innovation centers by 2020; increasing
domestically made core components and materials by 40% b-4 2020 and then to increase these domestically
made components by 70% no later than in 2025. (Lee, CKGSB Knowledge, 9/2/15) Details on how the plan will be
implemented however, have been very scarce.
THE PERCEPTUAL CONUNDRUN OF MADE IN CHINA, ETC
As India is selling its “Make In India” message, we wonder what the backlash might be? “Made in China” has
gone through a strong physical & perceptual revolution. In the beginning US mfgs shipped their orders to China
in the 1970s & 80s to take advantage of China’s cheap labor b-4 a final product was returned to the US with a
Vol 25 Iss 106
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Marketing & Advertising’s Bends, Trends & Ends
uNDER tHE mIKE- rOSCOPE
Made in America
Made in China
Made by Dangote
Made in India
M.D. Bernacchi, PhD, JD
Prof. of Mkt, UDM
“Made In China” label. The result was the eventual hue & cry of cheap labor yielding shoddily made products.
Eventually, “Made in China” was attacked b/c of poor workmanship, unsafe &/or even poisonous products with
a host of other shortcomings. Having said that, somebody “figured out” that China’s problems aside, that goods
made in China were robbing America and its firms of revenue, jobs, etc that eventually negatively impacted the
US and various state economies. The result was that the US had a “new made in” moment & called it of all things
“Made in America!!” with the hopes of revenues, jobs and biz viability returning to the US. The question of
course becomes how can “Make in India” avoid the same problems and pitfalls? It must deal with these same
issues± from the very start or MII may well be defeated. An interesting twist on this is the Buick Envision story.
It is now being imported from China after Buick (China’s elite brand) decided to build it in China and then to export
it to the US. US auto workers became livid with this very strange spin b/t China & the US with the strong fear of
the US eventually being flooded by Chinese made autos! (The old fear was the US being flooded with Chinese brands. Who
“wudda thunk” that the flood might start with a US brand?) WOW! Indeed “Made in China” has come full circle. As China
has become a manufacturing hub of the world, India wants to steal its manufacturing thunder. Can it successfully
do it w/o alienating China, and other manufacturing strongholds throughout the world? Prime Minister Modi
has many traps to avoid b-4 India can really become a manufacturing powerhouse. GOOD LUCK!
Made by Dangote
As China, India and the USA battle it out for manufacturing supremacy, here comes
the Dangote nation wanting a piece of the worldwide’ s manufacturing game. We
know that you wonder where this nation is, EXACTLY. Well it ain’t a nation, it’s an
African firm that wants the same thing China and India does. That is, Dangote
wants foreigners to invest in its country and to grow Africa’s economy, with
inexpensive labor. WOW! Where have we heard this tale± b-4?
MAKE IN INDIA