Draft Statement on Industrial Policy 2022

January 2, 2023

The Department for Promotion of Industry and Internal Trade (DPIIT) in India is currently working on a new industrial policy that aims to increase financing options for industry and promote the “Made in India” brand. This policy, titled the “Statement on Industrial Policy 2022 – Make in India for the world,” has been circulated to various ministries for their input and comments. It is expected to address the challenges and issues facing industry in India by implementing policy measures that will foster an innovative and competitive industrial ecosystem.

Objectives of the Industrial Policy

The proposed policy has identified six main objectives:

Competitiveness and capability: The policy aims to increase competitiveness and capability within the industrial sector in India.
Economic integration and global value chain: The policy aims to increase economic integration and move up the global value chain.
Attractive investment destination: The policy aims to make India an attractive investment destination.
Innovation and entrepreneurship: The policy aims to nurture innovation and entrepreneurship within the industrial sector.
Global scale and standards: The policy aims to achieve global scale and standards within the industrial sector.
Integrated investment promotion: The policy aims to implement an integrated investment promotion strategy by involving district, state, national, and international market synergies.

Financing Options for Industry

The proposed policy includes several suggestions for increasing access to finance for the industry. These include:

Setting up a development finance institution to provide finance at competitive rates.
Using a portion of foreign exchange reserves for funding.
Providing performance-based loans and incentives for innovation and green growth.
Leveraging fintech to increase access to finance.
Encouraging MSMEs (micro, small, and medium enterprises) to use the corporate bond market for financing.
Accepting intellectual property rights as collateral for loans.
Enabling supply chain financing.
Encouraging microfinance institutions to form cooperative groups and finance micro-enterprises at affordable rates.

Promoting the “Made in India” Brand

The proposed policy includes a scheme to promote the “Made in India” brand, which could serve as a platform for manufacturers to demonstrate local value addition and enhance the country’s credibility as a source of quality products.

Other Suggestions in the Proposed Policy

In addition to the financing options and the “Made in India” brand promotion scheme, the proposed policy includes several other suggestions:

Incentivizing public procurement to promote “Make in India.”
Creating a national digital grid.
Developing a robust data protection regime.
Setting up a technology fund.
Creating a task force to continuously identify skill gaps.
Strengthening export finance systems to enhance export competitiveness.
Creating innovation zones at the level of urban local bodies.
Formulating a national capacity development program to nurture innovation.
Rolling out social security schemes for women workers.
Including labor-intensive industries under the production-linked incentive scheme.

The proposed industrial policy from the DPIIT in India aims to address the challenges and issues facing the industrial sector in the country. It includes several suggestions for increasing access to finance and promoting the “Made in India” brand, as well as other measures to foster innovation and competitiveness. The policy is expected to replace the industrial policy of 1991 and is currently being circulated to various ministries for their input and comments.

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