Strategically being planned across 10 states along 6 major corridors, these projects represent a significant leap forward in India’s quest to enhance its manufacturing capabilities and economic growth. It will spur economic growth in underdeveloped regions and reduce regional disparities by transforming these regions into industrial powerhouses. This integrated approach has a significant socio-economic impact by promoting inclusive growth and contributing to sustained economic development in the regions, accelerating investments from both large anchor industries and MSMEs, creating 10 lakh jobs directly and another 30 lakh indirectly.
The development of these industrial corridors under the NICDP is set to be a major catalyst for positioning India as a global manufacturing hub. Designed to create a synchronized industrial ecosystem, these corridors feature robust transportation networks, reliable energy supplies, advanced telecommunications, and sustainable urban environments. These futuristic greenfield projects are in line with India’s vision of creating a vibrant industrial ecosystem that will act as a catalyst for achieving $2 trillion in exports by 2030.
Unlike low-cost manufacturing units of the past, these cities will boast ICT-enabled utilities, green technologies to minimize environmental impact, plug and play infrastructure and seamless connectivity. The cities will be equipped with water, power, gas, and telecom connectivity, along with rail, dedicated freight corridors, national highways, airports, and ports. India currently accounts for only 2.87% of global manufacturing. In comparison, China accounts for 31.63% and the US for 15.87%. Over the last few years, India has been focusing on attracting investments in manufacturing from frontier sectors like semiconductor, electronic goods manufacturing and extraction of critical mineral blocks. It has been offering industry-specific incentives and financial packages along with entering into technical collaborations across the globe.
While the hubs have immense potential, it is essential to address several challenges to fully realize the larger goal. Most manufacturers wanting to invest in India face challenges posed by land acquisition and environmental clearances. Despite the government’s efforts to expedite these processes, there are still hurdles that can lead to delays and increased costs for businesses. By aligning land acquisition policies with the broader objectives of ease of doing business, the government can facilitate smoother transitions for investors looking to set up operations in these corridors.
These smart cities, which are expected to be ready in a record three years, having dealt with these issues in advance, will encourage manufacturers to set up operations in India, with its advantages of skilled manpower, geographical location with easy access to major regions of the world via its extensive coastline and political stability.In essence, the recent industrial corridor initiative, if executed effectively, has the potential to propel India to the forefront of global manufacturing. By tacking ease of doing business from the core, by facilitating logistics, providing plug and play facilities and strengthening connectivity, these corridors should be more than just infrastructure projects, serving as catalysts for economic transformation. This will drive India towards becoming a global manufacturing powerhouse, ultimately contributing to the realization of a ‘Viksit Bharat’. A rework of the industry-friendly policies, in consultation with industry bodies, would speed up our journey.