Can the Development of Smart Cities Give the Desired Boost to the Indian Manufacturing Sector?
Successful execution of the Smart Cities plan will help India address its key infrastructure challenges, attracting investments into manufacturing
—Ajai Chowdhry , Founder, HCL
With urbanization growing at a rapid speed, Indian cities need to keep pace with it in order to address the socio-economic problems arising out of more and more labor moving to developed cities in search of livelihood.
While realizing the need for this development, the government introduced the ‘100 Smart Cities’ plan to develop these cities as satellite towns of larger cities to not just create job opportunities but also provide infrastructure based on modern technology with high-speed communication to boost the manufacturing sector. The government also made an allocation of `7,060 crore towards the Smart City plan in the Budget 2014-15 but the real test lies in its implementation to reap the benefits as envisioned.
Making India a Manufacturing Hub
Development of industrial corridors and smart cities will play a crucial role in attracting investments into manufacturing. Global investors are keen to invest in a large market like India but they remain apprehensive due to several challenges
that exist besides the ease of doing business and poor infrastructure. The development and successful execution of the Smart Cities plan can address some of the critical factors like connectivity to a good port, road and air connectivity, and availability of skilled talent to strengthen the Indian infrastructure. This will also help bring spotlight onto India as a global manufacturing hub, attracting investors from all parts of the world.
A lot of countries can also be offered enclaves in smart cities like Japanese enclave, Korean enclave, etc, where special facilities like their own food, education facilities along with world-class infrastructure will make it attractive. This will be good to get green industries like electronics to these smart cities.
The ‘Make in India’ program has been introduced with an aim to boost the domestic manufacturing sector and attract investments from businesses around the world. For a sustained growth of GDP, it is imperative that the growth in India’s domestic manufacturing sector continues with this new momentum.
Besides our own needs in education, government social sector projects, telecom, and strategic sectors like defence/ space, the country presents huge opportunities to other manufacturing facilities in hardware, automobile, etc. Also, one of the pillars of the ‘Make in India’ program is to strengthen the Indian infrastructure. Under the Smart Cities plan, focus on services like urban mobility and transportation, good IT connectivity, education, and sustainable urban environment can achieve this desired result. While the implementation of smart cities will play a key role in this development, the desired growth of manufacturing in India is also linked to availability of skilled professionals. The government also needs to look at training and preparing a skilled workforce in these cities to capitalize on the opportunities that manufacturing will provide.
From Vision to Reality
The development of these smart cities is with an aim to transform India and by taking up the smart cities program, India can not just benefit from best practices from all over the world but also make a mark in the global landscape.
As per the plan, 20 smart cities will be identified in 2015, 40 in 2016, and another 40 in 2017. With countries such as Singapore, Japan, France keen to partner with India on the ‘100 Smart Cities’ project, there cannot be a better time for the government to effectively utilize these opportunities and build a robust plan for its roll-out.
The ‘100 Smart Cities’, ‘Make in India,’ and ‘Digital India’ programs have put India under the spotlight in an increasingly competitive global landscape. With the right steps taken towards the implementation of these programs, India stands to become an attractive destination for FDI and uniquely suited to attract huge investments into manufacturing. With the progressive vision of the government and ambitious programs introduced, it remains to be seen how these can be successfully implemented to accelerate India’s growth story.