Benefits of PLI Scheme can be undone by lack of Ease of Doing Business

While hailing the government’s PLI scheme, the industry body MAIT (Manufacturers’ Association for Information Technology) has advocated the need for increased Ease of Doing Business (EoDB) at different state levels.

PLI is a well laid out strategy that pushes manufacturers to revisit their supply chain domestically and aspire for export-led growth, Nitin Kunkolienker, president, MAIT, said at its Electronics Manufacturing Summit held on Thursday.

He added that the scheme is going to bring in a drastic change in the thought process of the government(s)-shifting their erstwhile policy focus-from import substitution to export-led growth, which will, in turn, lead to design-led growth for the nation.

According to the President of the apex body representing India’s electronics & ICT hardware sector, the PLI scheme is one of the finest schemes introduced by the government during the last 25 years. “Before PLI, there was no strategy to make India a manufacturing hub. For the first time, we have an output linked incentives plan, which motivates players to bring in efficiency across processes and scale-up. But for PLI to be effective, the government has to crack the whip on Ease of Doing Business (EODB) across states, ” Kunkolienker told ET Online.

In terms of ease of doing business, Kunkolienker said the bigger challenge lies within and between states. The disconnect between the Centre and different states is an issue too. “Getting land, power and corruption at some places remain the key bottlenecks hurting electronic manufacturing across the country,” he said.

He also highlighted that ever since the pandemic hit global supply chains, the world realised that depending on one or two supply chains is risky and hence the need is to seize the opportunity by focussing on making India a global hub for electronics.

On the occasion, Harish Krishnan, Vice President, MAIT, asserted that there has been a significant shift in how India used to frame its key industrial policies. According to Krishnan, today there is a clear introspection over India’s strengths and its gaps, coupled with an open mind to fill those gaps. “Earlier the focus was on import substitution, but now on export growth. India for India is interesting, but India for the world is what is really exciting,” he said.