Manufacturing is a key sector for the economic development of any country. With the Indian market becoming an aggressive player in the manufacturing industry, raising the bar to global standards is critical for success. This requires for better standards to be set, which enable the Indian markets to sustain against the competition from imports. With the government initiative of Make in India, standards and standardization help manufactures understand what the Indian market is expecting from them in terms of quality and safety of their products and services. While the solution lay in aligning with global best practices, it is equally important for consumers to be educated on the importance of standards.
Beginning from the Industrial revolution to the present date, manufacturing has been an integral part of an economy’s development. While the services sector played a key role in the growth of the Indian economy during the last 3 decades, the manufacturing sector took a back seat and definitely calls for a high rev up. Having understood the need to augment the manufacturing sector, the government of India has come up with the ‘Make in India’ initiative. The program aims to place India on the global map by making it a global hub for manufacturing.
To boost the manufacturing sector as part of ‘Make in India’, reputed global manufacturers have been invited to set up their manufacturing bases in India Key areas such as defence, railways, construction and medical devices have been identified and opened up for Foreign Direct Investment. As a result, the sector is set to become highly competitive, along with experience of these multinationals in complying with global standards of production and operations.
This calls for the need to have internationally acceptable of global facing standards to help the domestic manufacturers comply with norms and produce world class quality Indian goods in order to be on a level playing field. A manufacturing unit operating without the right standards is prone to a complex production process with lower quality output leading to loss of market share. To cite an example, as per the Annual report by the Ministry of Commerce and Industry (Govt. of India) though the Index of Industrial Production (IIP) grew by 2.8% for the year 2015 over 2014, certain items like communication material and computing machinery have shown negative growth owing to a flood of better quality imports from across the world.
While there are standards developed domestically, there is a need for these products to comply to standards to compete with global market.. Global standards help manufacturers produce superior quality goods and many foreign players with global standards in place are set to compete on the domestic front in the time to come.
In a recent survey commissioned by UL India which involved interviewing 65 industry associations across the length and breadth of the country, a few interesting observations were made:
a) Seventy percent of the associations are concerned about the lack of specific standards for manufacturing and the import of cheaper products
b) Every stakeholder interviewed believed in the immediate need for standards to enhance productivity and business overall
c) More than sixty percent believed that lack of standards allows for the entry of high quality global players creating a disadvantage to the domestic players
These international players are further encouraged through the ‘Make in India’ campaign as they look to set up their manufacturing facilities and take advantage of the low cost labour and government subsidies. The only way for the domestic companies, that range from large enterprises to MSMEs to Start-ups, to compete against these global players is for them to produce high quality goods with ‘Zero Defect’. This can happen only when there are standards developed locally which are on par with the global standards. Domestically, we have the capabilities and the determination; we just need to have the right standards in place to help us compete better.
Having and complying with such Indianized global standards would lead to:
a) Products conforming to quality standards
b) Global market access
c) Better demand for the products and better brand image
The government has made its intention clear during the ‘Make in India’ week held in the month of February this year – to make India the hub for manufacturing. This event saw the representation of major domestic and global manufacturers some of whom have committed to make investments in India. The race is on, it’s up to us to get on the bandwagon and make optimum use of the support from the government. Even before we enter the race, it is highly important to develop the right standards; an Indianized version of the global quality standards will benefit the domestic manufacturing companies in more than one way.