Intro: This week on Socio-economic Voices we delve into the captivating world of the Indian industrial sector with Bibhudutta Subhasish, an Chief Economist at Avkar Engineering and Infratech. We uncover the harsh realities and untapped potential of the Indian industrial sector. In one of a kind in-depth EXCLUSIVE analysis for Indiastat Mr. Subhasish reveals the daunting challenges hindering progress, the groundbreaking strategies needed for transformation, and the electrifying possibilities that lie ahead. From the transformative power of technology to the game-changing role of skill development, senior journalist Mahima sharma explores the secrets to unlocking India's industrial success towards an inclusive growth via an in-depth interaction with Mr. Subhasish who exposes the risks and rewards of international trade and finance in today's ever-evolving economic landscape.

MS: What are some of the current challenges faced by the Indian industrial sector? How can these be better addressed by the government and other stakeholders?

BS: India industrial sector growth is currently facing a range of challenges that are affecting its growth and development. I am sharing certain details…

• Firstly, the COVID19 pandemic led to disruptions in operations due to lockdowns, supply chain issues, labor shortages, and poor consumer demand.
• Secondly, inadequate infrastructure, including transportation networks, power supply, logistics, and digital connectivity, is hampering operational efficiency, increasing costs, and limiting competitiveness.
• Additionally, there is a skill gap in certain sectors, hindering productivity and technology adoption, which highlights the need for stronger skill development initiatives.
• Moreover, complex regulatory frameworks, bureaucratic procedures, and policy inconsistencies are impeding the ease of doing business, and access to affordable finance is limited, particularly for small and medium-sized enterprises (SMEs), constraining investment opportunities.
• Land acquisition for industrial projects faces challenges related to legal frameworks, community consent, and environmental regulations, leading to delays and hampering growth.
• Adequate and affordable energy supply is critical, but challenges such as power shortages, unreliable electricity supply, and high energy costs are affecting the competitiveness of the industrial sector.
• Furthermore, limited technology adoption, insufficient investment in research and development (R&D), and a lack of collaboration between industry and academia are hindering innovation and competitiveness.
• Global trade barriers, protectionist measures, and intense international competition also pose challenges for Indian industries. Balancing India industrial sector growth with environmental sustainability, managing waste and emissions, and adopting cleaner technologies are significant concerns.

To address these challenges, a comprehensive approach involving policy reforms, infrastructure development in India, skill enhancement, access to finance, technological innovation, and sustainable practices is necessary. Collaboration among the government, industry associations, and stakeholders is essential to create a favorable environment for the growth of the Indian industrial sector.

MS: India has overtaken China's population. What kind of changes would its industrial economic strategy/ policies need to become a self-dependent nation, not just in terms of employment but better output as well?

BS: A larger population can be perceived as a problem, but it also brings benefits. Economies of scale, like the low telecom tariffs in India, are possible due to a large consumer base. However, improving labor productivity and participation rates in India is essential. This will increase the number of buyers/consumers, benefiting manufacturers and producers.

To become a self-dependent nation in the industrial sector, India can consider implementing the certain strong changes that I am sharing, in its industrial policies:

• Promote Indigenous Manufacturing: Encourage domestic production growth in India, incentivize local manufacturers, and support them in government procurement.
• Strengthen R&D: Foster industry-research collaboration, offer financial incentives, and tax benefits for companies investing in cutting-edge technologies and product quality improvement.
• Skill Development and Training: Design training programs aligned with emerging technologies, promote apprenticeships, vocational training, and entrepreneurship development for a skilled workforce.
• Ease of Doing Business: Simplify regulations, streamline approvals, establish single-window clearances, and digitize procedures to attract investments and reduce red tape.
• Infrastructure Development: Prioritize robust infrastructure, invest in industrial parks and corridors, improve connectivity, and logistics for efficient movement of goods.
• Faster Access to Finance: Ensure affordable finance, establish specialized lending schemes, simplify loan procedures, and reduce interest rates, particularly for SMEs.
• Export Promotion: Provide incentives, facilitate market access, and support diversification, quality improvement, and market intelligence for export-oriented industries.
• Sustainability and Green Practices: Promote clean technologies, renewable energy, and eco-friendly practices. Incentivize carbon emissions reduction, resource conservation, and adoption of circular economy principles.
• Collaboration and Partnerships: Foster public-private partnerships, drive innovation, technology transfer, and knowledge sharing between government, academia, and industry. Support joint projects and industry-academia interaction through funding mechanisms.

MS: How are developments in technology (like AI) and innovation shaping the future of the industrial sector in India? What challenges do they present and how must the stakeholders address the same?

BS: It is evident that technology and innovation are transforming India's industrial sector in various ways. But a few examples will help all understand the situation in a better manner:

• Automation and Industry 4.0: Adoption of robotics, automation, and advanced manufacturing technologies optimizes production, reduces costs, and enhances competitiveness through increased efficiency and flexibility.
• Digital Transformation: Embracing cloud computing, big data analytics, AI, and ML streamlines operations, improves supply chain management, and enhances customer experience through real-time decision-making and data-driven insights.
• Start-up Ecosystem: Collaboration with agile start-ups drives innovation and disruptive solutions, leveraging their expertise to foster transformation and maintain competitiveness.
• Internet of Things (IoT) and Connected Devices: IoT-enabled sensors and data analytics enhance operational efficiency, predictive maintenance, and supply chain optimization by monitoring equipment, improving energy management, and enabling real-time control.
• Renewable Energy and Sustainability: Integration of clean energy solutions and sustainable practices reshapes the India industrial sector growth by transforming the landscape, incorporating solar power, wind energy, and energy-efficient manufacturing processes.
• Advanced Materials and Manufacturing Techniques: Innovations in materials science enable the development of lightweight, high-strength materials and additive manufacturing, improving product performance and reducing waste.
• Supply Chain Optimization via blockchain, predictive analytics, and cloud-based platforms enhance supply chain management, improving visibility, traceability, inventory management, and collaboration for operational efficiency and customer satisfaction.
• Skills and Workforce Development focusing on emerging technologies and digital skills prepare the workforce to adapt to technological advancements and contribute to the sector's growth.

While these advancements demonstrate the transformative impact, they also come with their own set of challenges. Let’s learn what these are and how can the nation overcome these…

• Better Digital Infrastructure is needed in many regions of India. The government should focus on expanding broadband connectivity and ensuring reliable power in industrial areas.
• Tech Skills and Talent Gap: To bridge this gap, we need to invest in training programs for AI, ML, data analytics, cybersecurity, and robotics. Public-private partnerships can help design programs aligned with industry needs.
• High Cost of Technology Adoption: MSMEs, SMEs face barriers to adopting new technology due to high initial costs. The government should provide financial incentives, tax breaks, and affordable financing options to encourage technology adoption. Collaboration between tech providers and financial institutions can create tailored financing models for SMEs.
• Poor Data Privacy and Security: We need strong data protection laws and regulations. Organizations should prioritize data security and invest in cybersecurity infrastructure to reduce risks and build trust in digital systems.
• Industry-Academia Collaboration, better regulatory framework: as well as widespread adoption of technological advancements is needed; pilot projects, tech showcases, and demonstration centers can help industries get hands-on experience.
• Cultural Mindset and Change Management: Overcoming resistance to change, improving digital literacy, and managing risks are crucial. Investing in change management strategies, training, and awareness campaigns fosters innovation and seamless tech integration.

MS: In your view and analysis, what is the outlook for India's industrial economy in the short and long term? And what factors are likely to shape its future growth and development?

BS: Let me start with sharing the Short-Term Outlook: India industrial sector growth and economy is expected to recover gradually from the impact of the COVID-19 pandemic. Government efforts and increased vaccination rates will support the sector's rebound. However, challenges like supply chain disruptions, rising input costs, and labor dynamics may affect the pace of recovery.

Long-Term Outlook: In my personal opinion, based on various facts, India's industrial economy holds significant growth potential due to various factors. I am sharing the key ones.

• Demographic Advantage: India's young and growing population can drive industrial growth with proper skill development and employment opportunities.
• Urbanization and Infrastructure Development: Urbanization provides opportunities for industrial expansion, supported by infrastructure development in India via its smart cities, transportation networks, and logistics hubs.
• Manufacturing and Export Potential: Initiatives like Make in India and self-reliance promote domestic manufacturing, attracting investments, enhancing value addition, and contributing to export growth.
• Digital Transformation: India's digital transformation drives innovation and growth in sectors like IT, e-commerce, fintech, and digital services, boosting productivity and competitiveness.
• Renewable Energy and Sustainability: India's focus on renewable energy statistics India and sustainability creates growth opportunities in solar power, wind energy, electric mobility, and green technologies, fostering innovation and attracting investments.
• Policy Reforms: Government policy reforms aim to improve the ease of doing business, attract investments, and promote industrial growth, creating a conducive environment for development.

Now let’s take a look at the Future Factors that will shape India's industrial growth and development…

1. Infrastructure Development: Continued investment in transportation, logistics, power supply, and digital connectivity is crucial for industrial growth and competitiveness.
2. Skill Development: Effective initiatives aligning the workforce with industry needs are essential for sustained growth.
3. Innovation and R&D: Encouraging innovation, promoting R&D, and fostering collaboration between academia, industry, and research institutions will enhance competitiveness.
4. Global Economic Dynamics: Global trends, geopolitics, and trade policies will influence industrial growth. Adapting to global dynamics and seizing export opportunities are vital.
5. Sustainable and Inclusive Growth: Prioritizing sustainability, resource efficiency, and inclusive development is critical for addressing environmental challenges and ensuring equitable growth.

MS: You have worked in various nations and their projects. What are some examples of successful skill development initiatives in other countries that India could learn from and adapt to its own needs?

BS: There are several successful skill development initiatives implemented in various countries that India could consider learning from and adapting to its own needs. Here are a few examples:

Germany's Dual Vocational Training System combines practical on-the-job training with classroom education, creating strong partnerships between industry and educational institutions to teach skills aligned with industry requirements. India could adopt a similar approach to bridge the gap between theory and practical skills.

Singapore's SkillsFuture Initiative provides lifelong learning opportunities, career guidance, and industry-relevant training to equip individuals for a rapidly changing economy. India could develop a comprehensive lifelong learning framework to encourage continuous skills upgrading and staying relevant in the job market.

Australia's Industry Skills Councils bring together employers, experts, and training providers to identify industry skill needs and develop targeted training programs. India could establish sector-specific skill councils to align training with industry requirements.

South Korea's National Competency Standards: define the skills required for different occupations, serving as a reference for curriculum development and assessment. India could adopt a standardized competency framework for consistent and quality skill development.

Canada's Apprenticeship Programs combine on-the-job training with classroom instruction, offering financial incentives and recognized certifications. India could strengthen its apprenticeship programs by increasing industry participation and enhancing the quality and recognition of apprenticeship training.

The United Kingdom's Sector Skill Councils bring together employers, unions, and professional bodies to identify skills needs, set standards, and develop training programs. India could establish similar sector-specific bodies to drive skill development and industry engagement.

MS: What steps can be taken to ensure that skill development programs are inclusive and accessible to all segments of the Indian population?

Coming onto the second part of the question, ensuring inclusivity and accessibility in skill development programs is crucial to address the diverse needs of all segments of the Indian population. In my opinion India should take a few stringent measures…

• Targeted Outreach: Reach marginalized communities through local organizations, NGOs, and grassroots initiatives. Encourage participation in skill development programs.
• Removal of Barriers: Address financial constraints, transportation issues, and limited qualifications. Provide scholarships, stipends, and training centers in underserved areas.
• Flexible Course Offerings: Offer part-time, evening, and online classes to accommodate diverse learners, including those with jobs or family responsibilities.
• Customized Training Modules: Tailor programs to meet the needs of women, persons with disabilities, and marginalized groups. Address their unique challenges, skills, and interests.
• Sensitization and Awareness: Challenge biases and stereotypes that deter certain groups from participating. Promote the benefits of skill development and challenge restrictive norms.
• Mentorship and Support Systems: Establish guidance programs for participants. Boost confidence, offer career guidance, and address specific challenges.
• Collaboration with Stakeholders: Partner with employers, industry associations, and civil society organizations. Ensure programs align with industry needs and create employment opportunities.
• Monitoring and Evaluation: Regularly assess inclusivity and impact. Collect data to inform policy decisions and improve program strategies.

MS: What are the key risks and opportunities for international trade and finance in the current economic environment, and how can businesses and governments effectively manage them?

BS: In the current economic environment in India, there are both risks and opportunities for international trade and finance. Here are some key risk factors to consider:

Geopolitical Tensions: If major economies like Russia and the US, have escalating trade tensions, it could affect India's trade relationships and export opportunities.

Protectionist Measures: Some countries are implementing policies to protect their own industries, like tariffs and trade barriers. These measures can limit market access and increase trade costs, which may affect India's exports and make its industries less competitive.

Global Economic Slowdown: If the global economy slows down, the demand for Indian exports can decrease, impacting international trade. Weaker growth prospects in key markets can affect India's export-oriented industries.

Currency Fluctuations: When currency exchange rates become volatile, it can affect the competitiveness of Indian exports and create uncertainties for businesses engaged in international trade. Sudden currency fluctuations can impact the profitability of exporters and importers.

Now let’s take a look at the opportunities that India has in the current scenario

Embracing the Digital Era: Indian businesses can leverage technology to expand their reach in international markets. E-commerce platforms and digital payment systems provide access to a global customer base, opening up new avenues for cross-border trade.

Tapping into Emerging Markets: India's strategic location and growing middle-class population make it an attractive market for businesses looking to expand into emerging economies. Exploring markets with increasing consumer demand in Asia and Africa can boost India's export potential.

Infrastructure Development in India: It focuses on infrastructure development and presents opportunities for international investors and companies in sectors like transportation, logistics, energy, and telecommunications. Collaboration in these areas can benefit both local and foreign participants.

The "Make in India" campaign aims to boost domestic manufacturing and attract foreign investment in India. International businesses can establish manufacturing facilities in India, tapping into the skilled workforce and accessing the domestic and regional markets.

India's services sector, including IT services, software development, finance, and healthcare, has been a key driver of its economy. International companies can partner with Indian firms, taking advantage of India's skilled services workforce and offering services both domestically and globally.

India's commitment to renewable energy presents opportunities for international companies specializing in clean energy technologies, equipment, and project development. Investing in this sector aligns with renewable energy statistics India aims to target to foster collaboration.

India's growing economy and increasing financial inclusion create opportunities for international financial institutions. Collaborating in areas like banking, insurance, fintech, and digital payments can tap into the unbanked population and growing consumer demand.

MS: What opportunities exist for foreign investors in the energy and infrastructure sectors in India?

BS: Energy costs in India are quite higher as compared to other Nations owing to overdependence on non-renewable sources. The renewable energy generation industry will have a significant growth impact as we move towards alternative sources of energy. But, still I am sharing some key opportunities for now and the reasons too:

Renewable Energy: Foreign investors can participate in solar, wind, hydro, and biomass projects in India. The government offers incentives like tax benefits and streamlined approval processes to attract foreign investment in India towards this sector.

Power Generation and Transmission: Opportunities exist for foreign investors in coal-based power plants, gas-fired plants, and nuclear energy projects. The government's investment in strengthening transmission and distribution infrastructure creates avenues for foreign investment in grid modernization and smart grid projects.

Electric Mobility Sector: India is promoting electric vehicles (EVs) to reduce pollution. Foreign investors can explore opportunities in EV manufacturing, charging infrastructure, and battery manufacturing.

Smart Cities and Urban Infrastructure: India's urban population is growing rapidly, leading to investment opportunities in smart city projects and urban infrastructure development. Foreign investors can participate in transportation, water management, waste management, affordable housing, and urban technology solutions.

Affordable Housing Sector: The Indian government's focus on affordable housing presents opportunities for foreign investors. Initiatives like Pradhan Mantri Awas Yojana (PMAY) aim to provide affordable housing to all by 2022. Foreign investors can participate through partnerships with local developers or by investing in real estate investment trusts (REITs).

Logistics and Transportation Sector: India is investing heavily in improving its logistics and transportation infrastructure, including ports, airports, railways, and roads. Foreign investors can participate in infrastructure projects, logistics hubs, and associated services.

Water and Waste Management Sector: Foreign investors can contribute to water treatment plants, recycling facilities, and waste management projects.

To attract foreign investment in India the government has implemented various measures such as liberalized FDI policies, single-window clearance mechanisms, and the creation of dedicated investment facilitation agencies.

MS: What is the impact of the Production Linked Incentive Scheme (PLI) on various sectors of industries after it was introduced in India and what are the key benefits India is reaping under this scheme? In your opinion, what other push to scale-up the manufacturing sector is required in India?

BS: The PLI Scheme has demonstrated positive outcomes in terms of attracting investments, boosting manufacturing capabilities, creating employment opportunities, and reducing import dependence in various sectors. It has helped India position itself as a manufacturing hub and has contributed to the government's Make in India initiative. The scheme continues to evolve with new sectors being added to its purview, thereby expanding its impact across different industries in the country. I am sharing some noteworthy examples…

1. Electronics Manufacturing: The PLI Scheme has attracted significant investments from domestic and foreign companies, boosting electronics manufacturing in India and reducing import dependence.
2. Pharmaceuticals: The PLI Scheme aims to enhance domestic production growth in India of critical drugs, making India a global hub for pharmaceutical manufacturing and reducing reliance on imports.
3. Automobiles and Auto Components: The PLI Scheme promotes the manufacturing of electric vehicles (EVs) and their components, attracting investments and expanding EV manufacturing capacities in India.
4. Textiles Sector: The PLI Scheme boosts the manufacturing of man-made fibers and technical textiles, encouraging product diversification and value addition in the textile industry.
5. White Goods (ACs and LED Lights): The PLI Scheme targets the manufacturing of energy-efficient air conditioners (ACs) and LED lights, promoting domestic production growth in India and reducing energy consumption.
6. Telecom Equipment: The PLI Scheme stimulates domestic manufacturing of telecom and networking products, enhancing the country's telecom infrastructure and reducing dependence on imports.

MS: Metal, mining, chemical, energy, and infrastructure sectors - have been the reigning sectors in India. What is the outlook for these industries in the near future, given the current state of the global and Indian economies?

BS: The Metal, Chemical, Energy, Infrastructure and Mining Sector in India holds immense promise. I am sharing a quick overview:

Metal Sector: Steel industry growth will be fueled by infrastructure development In India, housing projects, and automotive production. Capacity utilization is projected to reach 80% in FY 2023. Government initiatives like the National Infrastructure Pipeline and the promotion of electric vehicles will boost metal demand.

Mining Sector: The mining sector in India aims to reform itself to attract investments, encourage sustainable practices, and increase mineral production. Focus on mineral exploration and block auctions will drive production and attract domestic and foreign investment in India.

Chemical Sector: Increasing demand from pharmaceuticals, agrochemicals, specialty chemicals, and consumer goods will drive growth. Favorable government policies, rising domestic consumption, and expanding exports contribute to sector expansion.

Energy Sector: The nation is transitioning to cleaner and sustainable energy sources, with a focus on renewables like solar and wind power. Reforms in the oil and gas sector will attract investments and enhance domestic production in India.

Infrastructure Sector: Robust growth is anticipated in India's infrastructure sector, with the National Infrastructure Pipeline set to invest around INR 111 lakh crore from FY 2020-2025. Smart city projects, transport network improvements, and urban infrastructure upgrades will drive demand. Public-private partnerships and foreign investments will be pivotal.

These sectors present lucrative growth opportunities in India, supported by government initiatives, domestic consumption, and the need for modern infrastructure. However, challenges such as environmental concerns, regulatory complexities, and access to finance and skill development in India among the labour needs attention to fully harness their potential.

MS: Startups, mission UNICORN and the above five sectors. What opportunities exist for investors in these industries currently? What factors should be considered when evaluating potential investments?

BS: Investment opportunities in India's metal industry include steel production, setting up new plants, capacity expansion, and modernizing existing facilities. For instance, the aluminum industry offers prospects in smelting, downstream processing, and recycling to meet demand from transportation, construction, and packaging sectors.

In the mining sector in India, investors can explore mineral exploration and development through auctions, untapped resources, and advanced technologies. Setting up mineral processing plants and value-added facilities for coal, iron ore, bauxite, and rare earth minerals also holds potential.

In the chemical sector, specialty chemicals for pharmaceuticals, agrochemicals, personal care, and electronics present investment avenues. Additionally, there are opportunities in green chemistry for developing sustainable chemicals and renewable energy technologies.

Renewable energy investments can be made in solar and wind power through farms, manufacturing equipment, and participation in auctions. Energy efficiency projects like energy-efficient buildings and appliances are also promising.

Infrastructure sectors such as roads, urban development, and logistics offer lucrative prospects. Investing in road construction, smart cities, and setting up logistics parks and warehouses can tap into growing demand.

Coming on to the second part of the question, when evaluating investments, consider regulatory frameworks, market demand, competition, infrastructure, resources, technology, stability, risks, sustainability, partnerships, and local relationships. Thorough due diligence, local expertise, and alignment with India's development goals are crucial for successful investment decisions.

MS: Last question is for our student readers. You have a vast experience in Industrial Economist | Entrepreneurship | ESG | Skill Development and more. What kind of education, training and passion is required to build such a strong portfolio?

BS: If you want to pursue a career in Industrial Economics Research, Entrepreneurship, ESG (Environmental, Social, and Governance), or Skill Development, here's what you need to know:

For Industrial Economics, you'll need a strong foundation in microeconomics, macroeconomics, quantitative methods, and econometrics. Consider a master's program in applied economics or quantitative economics after your bachelor's degree. Gain practical experience through internships at NGOs or organizations focused on social development. Attend workshops and training programs to enhance skill development in India. Certifications like Certified Industrial Economist (CIE) or Chartered Economist (Ch.Econ) can boost your expertise. Passion for analyzing economic trends, industrial policies, and market dynamics is crucial. Strong analytical and quantitative skills, critical thinking, and the ability to interpret complex economic data are valuable.

Entrepreneurship doesn't have specific educational requirements, but a degree in business administration or related courses can provide a solid foundation. Learn about accounting, finance, marketing, people management, and strategy. Get practical experience through internships, mentorships, or start-up programs. Consider specialized entrepreneurship programs or certifications. Passion for innovation, risk-taking, and problem-solving is essential. Skills like creativity, adaptability, leadership, and resource management are key to success.

For ESG, study sustainability, environmental studies, and the United Nations' sustainable development goals. Take courses on sustainability reporting, impact investing, corporate social responsibility, environmental management, and sustainable finance. Look into training programs and certifications like the Global Reporting Initiative (GRI) and Sustainability Accounting Standards Board (SASB) for deeper understanding.

Skill Development is crucial in today's world. Study human resource management and vocational training. Explore courses on curriculum development, instructional design, and assessment methods. Attend workshops, trainer programs, and certifications related to skill development. Gain practical insights and strategies.

Build a strong network, stay updated with industry trends, and gain practical experience through internships or volunteering. Keep learning, stay motivated, and embrace an entrepreneurial mindset for personal and professional growth.

About Bibhudutta Subhasish

Bibhudutta Subhasish is a Practicing Economist specializing in sustainable manufacturing practices, ESG, waste management, and social impact. He currently works with an emerging construction and Infratech start-up in Odisha, India as their Chief Economist. With a background in financial writing at Motley Fool, he later gained expertise in the metal and mining industry, focusing on downstream commodities like steel, aluminum, and copper. As an Analyst, he tracked commodity prices, market competition, and import/export trends. Bibhudutta has published over 30 articles on the Steel Industry and contributed to a publication in the SAGE journal. He also served as a Research Lead in the Chemicals and Materials practice, focusing on African mining, 3D printing technology, and the construction sector. In the non-profit sector, he collaborated with MSMEs as an Industrial Economist, providing market research, sustainable development initiatives, ESG implementation, and skill development training. His work extended to creating high-value job opportunities in India, Latin America, Africa, and Southeast Asia.

About the Interviewer

Mahima Sharma is a Senior Journalist based in Delhi NCR. She has been in the field of TV, Print & Online Journalism since 2005 and previously an additional three years in the allied media. In her span of work she has been associated with CNN-News18, ANI - Asian News International (A collaboration with Reuters), Voice of India, Hindustan Times and various other top media brands of their times. In recent times, she has diversified her work as a Digital Media Marketing Consultant & Content Strategist as well. Since March 2022, she is also an Entrepreneurship Education Mentor at Women Will - An Entrepreneurship Program by Google in Collaboration with SHEROES. Mahima can be reached at media@indiastat.com

Disclaimer : The opinions expressed within this interview are the personal opinions of the interviewed protagonist. The facts & statistics, the work profile details of the protagonist and the opinions appearing in the answers do not reflect the views of Indiastat or the Journalist. Indiastat or the Journalist do not hold any responsibility or liability for the same.