GS3 (Indian economy)
Should India make special efforts to develop its manufacturing sector? What are the issues with the current sector wise share of agriculture, industry and service in the Indian economy?
Best answer
Rahul Jain wrote the best answer for this question and got a score of 5/10 (if the best answer is an image, it cannot be uploaded here, hence scroll down to see those). The answer is being reproduced below for everyone’s convenience. Of course these answers can always be improved. (Best answer of a particular only involves those given on that day, later answers may not have been checked)
India is a major economic powerhouse but the share of all sectors in the economy is different:
1. Share of agriculture in GDP is around 16% but it is still a major employment provider.
2. Service sector has a major share in GDP but not provides very less employment opportunities.
3. Unlike in major economies, the manufacturing sector has not developed much in India.
This type of growth is also known as the “JOBLESS GROWTH”.
Indeed the govt has taken steps to tackle this situation via measures like MAKE IN INDIA, policies for improving ease of doing business,SKILL INDIA,START-UP INDIA etc.
Benefits of developing manufacturing sector:
1. Employment pressure on agriculture will reduce.
2. Might lead to a favourable balance of trade(imports decreasing and exports increasing)
3. Manufacturing has an upward linkage with the primary sector and thus would boost the rural economy.
CHALLENGES:
1. Infrastructure bottlenecks(power,connectivity etc.) still exist
2. Land and labour reforms
3. Skill development of the human dividend.
WAY FORWARD:
1.Stakeholder approach on land and labour reforms
2. Incentives to manufacturing based START-UPs too
Given that India is set to have the largest demographic dividend by the next decade, it is imperative that the manufacturing sector should take the lead in using this dividend. Govt. initiatives taken in this regard are a good start in that direction.
