Twelve years after Make in India, manufacturing's share in GDP, jobs and exports has barely moved. Examine the reasons and suggest reforms.

Launched on 25 September 2014 to make India a global hub for manufacturing across 25 focus sectors [1], Make in India has raised investment and output, yet manufacturing's structural weight in GDP, employment and exports remains largely unchanged — a shortfall rooted in policy design, not effort.

Reasons for the stagnation

• Assembly rather than value addition: incentives reward final output, so high-value components stay imported. Export headline numbers rise while domestic value creation — and hence the GVA share — does not.
• Gains confined to a few sectors: electronics alone has drawn ₹15,554 crore of PLI incentive, against ₹2,377.56 crore for the entire automobile sector [3]. Concentrated support cannot shift an economy-wide share.
• Capital-intensive sector choice: PLI's 14 sectors are dominated by capital-heavy industry. Investment of over ₹2.40 lakh crore has yielded about 14.15 lakh jobs [2] — marginal against a 100-million-jobs ambition.
• Neglect of labour-intensive industry: Economic Survey 2016-17 identified apparel and leather as India's best route to mass, formal job creation, warning that the space China vacated was passing to Bangladesh and Vietnam [4] — which is what happened.
• Tariff and regulatory drag: a high, fragmented duty structure on intermediates raises input costs and keeps firms out of global value chains [5], while compliance burdens weigh heaviest on job-creating MSMEs [6].

Reforms required

• Rationalise tariffs on intermediates and capital goods, shifting from import substitution to GVC integration [5].
• Redirect incentives from assembly to component and deep manufacturing, judged by rising domestic value addition.
• "Ease of Doing Business 2.0" — state-led land, labour and building deregulation, since these are largely State subjects [6].
• Revive labour-intensive exports through FTA market access and simpler factory rules [4].
• Tie incentives to value addition and employment outcomes, not turnover.

Make in India has genuinely built capability in electronics and lifted investment; what it has not yet done is change the structure of the economy. A second phase — cheaper inputs, deregulated States and a deliberate labour-intensive push — can convert assembly-led growth into the broad-based industrialisation that alone delivers the jobs a young India needs.