National Manufacturing Policy update

The panel of ministers headed by agriculture minister Sharad Pawar on Friday resolved differences over the National Manufacturing Policy (NMP) which seeks to step up the share of manufacturing in the country’s gross domestic product (GDP) to 25% within a decade and create 100 million jobs. Top sources said the policy has been cleared by the GoM. Prime Minister Manmohan Singh had set up the group of ministers after differences within the government forced the Cabinet to defer a decision on the much-awaited policy. Concerns over labour and environment issues had stalled approval of the policy as the two ministries had opposed the industry ministry’s plan. “There were certain issues raised by environment, labour and MSME (ministries). We discussed in depth and found some solutions,” Pawar said after the meeting. He did not elaborate. Commerce, industry and textiles minister Anand Sharma had discussed issues related to the policy with environment minister Jayanthi Natarajan after she took charge of the ministry in July and a broad consensus was understood to have evolved over NMP, which aims at creating over 220 million jobs in the next 15 years and is keenly awaited by the industry and investors. But differences surfaced in the cabinet meeting which led to the setting up of the group of ministers. Now a fresh draft incorporating the changes discussed in the GoM would be finalized and moved before the cabinet for its approval. The NMP aims at augmenting the share of manufacturing in GDP to 25% from the current 15-16% within a decade and create 100 million jobs. The policy had earlier received in principle approval from Singh but was delayed due to opposition from labour and environment ministries. The key focus of the policy is to improve the business environment and enable easy technology acquisition and development, provide access to capital for small and medium enterprises and enhance the role of the private sector in skill development. The focus would be on minimizing the role of government and creating an environment of self-regulation as far as possible. It also talks about flexibility in labour laws.