China hits back at Modi with 'Made in China' campaign

China government organisations are asked to implement new measures as soon as possible to arm "Made in China" with advanced technology and equipment, encouraging more competitive products with high added value


The Chinese government has launched a "Made in China" campaign with a host of tax concessions. This launch coincides with Prime Minister Narendra Modi's "Make in India" pitch.


China will encourage high-tech imports, research and development (R&D) to upgrade 'Made in China', a decision by the Chinese central government said.


Under the new campaign China will use tax breaks to encourage enterprises to upgrade their equipment and increase R&D efforts to improve the manufacturing industry.


Companies that bought new R&D equipment and facilities after 1st January or possess minor fixed assets will have taxes reduced based on value, the Cabinet, presided over by Premier Li Keqiang, has decided.


Imported high-tech equipment will also enjoy tax deductions in aviation, bio-medicine production, manufacturing of railway and ships, electronics production including computer and telecommunications, instrument production and those used in making IT products and software, state-run Xinhua news agency reported.


The new decision coincides with the global launch of Modi's 'Make in India' campaign today.


The Indian Embassy, Consulates in Guangzhou, Shanghai and Hong Kong held special investment promotion events showcasing the 'Make in India' campaign.


China's new move aims to prompt technical improvement of companies, especially innovation of small and medium-sized enterprises, which in the last three decades propelled it to become world's second largest economy and made it a powerhouse of the manufacturing industry.


The cabinet asked government organisations to implement the new measures as soon as possible to arm "Made in China" with advanced technology and equipment, encouraging more competitive products with high added value, the report said.


China's manufacturing sector, a key driver of its economic growth, is regarded highly competitive in the global market.


Analysts believe the measures will not only start a new round of innovation but also spur fixed asset investment, and, in the bigger picture, contribute to stabilising economic growth.


Modi’s target to put India in the top 50 in ‘Ease-Of-Doing-Business’ a pipedream?

India is ranked 134 out of 189 in the ease of doing business rankings of the World Bank. The PM's desire would require huge shifts at the Central, State, Judiciary, Regulatory and Executive levels. Can he achieve it all in three years?


Prime Minister Narendra Modi today launched the Make In India campaign. His target audience was primarily Indian businessmen, who have themselves been apprehensive about investing in India. While we court foreign direct investment (FDI) and foreign institutional investment (FII), the business environment in India is so poor that the Prime Minister has to push Indian businessmen to invest here. The only places in the world, where a businessman is worse off than India are either war-ravaged nations or those which are currently involved in civil conflicts.

India is ranked 134 out of 189 in the ease of doing business rankings of the World Bank. The West Bank and Gaza are at 138. Some of the countries that do better than us in these rankings include Ethiopia (125), Uganda (132), Bangladesh (130), Pakistan (110), Nepal (105) and even Vietnam (99).

The Prime Minister, in his speech to the Make In India audience stated that he wished to take India higher in the Ease-of-Doing-Business Index. When the World Bank Chairman Jim Yong Kim visited India in July, he had said that if Gujarat were to be taken as a separate entity, for the sake of evaluation, and then it would be among the top 50 in the rankings. So PM Modi wants India to break into top 50 in three years. Is this feasible?

To better understand what is involved in pushing India up these rankings, take a closer look at what constitutes the score in these rankings. What determines the final rank for a country is based on: (India's rank in parenthesis out of 189 nations)

1. Starting a Business (179)
2. Dealing with Construction Permits (182)
3. Getting Electricity (111)
4. Registering Property (92)
5. Getting Credit (28)
6. Protecting Investors (34)
7. Paying Taxes (158)
8. Trading Across Borders (132)
9. Enforcing Contracts (186)
10. Resolving Insolvency (121)

If the two factors 5 and 6 above are excluded, India's ranks on the rest leaves a little too much to be desired. Problem is, Modi can do little about the 8 factors where India’s ranking is pathetic.

Starting a Business: Depending on the industry, starting a business requires procedures to be completed with both Central and State agencies and departments. In India, starting a business requires an average of 27 days, to complete 12 required procedures (according to World Bank estimates). This, as any businessman will tell you, is an understatement, because it does not account for the great Red Tape that needs to be negotiated for even the simplest approvals. The government is said to be working on the issue of permissions.


With most registrations online and providing single-window clearances, starting a business could get a little simpler. But a number of State-level permits are needed too, what will happen to these? Modi has no control over them.

Paying Taxes: An Indian businessman suffers an average of 33 tax payments a year. While the South Asian average is also at 33, the OECD average is 12. The sheer number of taxes goes beyond suffocation and harassment. Moneylife has written before about how India's tax system is built to encourage harassment and extortion by officials and bureaucrats. There is no change in this.

Trade Across Borders: On one hand, India is ranked 132 on this and the PM has expressed that he wants to focus on trade, but on the other hand India voted against the WTO agreement at the last minute, which could have achieved better cross border trade. Reducing the number of clearances and documentations needed for export and import is the need of the hour. The Commerce Ministry is seriously looking to improve this. No steps taken so far

No Control of the Centre: Now we come to the hardest part, factors where the Centre has little to zero control. Registering Property (92), Getting Electricity (111) and Construction Permits (182) rest almost completely with State departments and agencies. It is difficult to conceive how the PM and the Centre propose to deal with these problems for businessmen and investors. Then we may come to the final thorn in the businessman's side, India's much-respected yet absolutely inaccessible judicial system.

On Enforcing Contracts, which is possibly the foundation of a business environment, India ranks 186 out of 189 countries. The time taken to get a hearing and then an award or decision in the courts and tribunals in India, is beyond measure. It has come to a point where property related and civil disputes are now being fought with only the interim order in view, because the final award is too far ahead in the future to even consider. The final measure that the Index deals with is Resolving Insolvency, which again leads in many cases to the doors of Indian courts.

Out of the factors listed and discussed above, improving scores on each of these counts would mean working at Centre, State, Judiciary, Regulatory and Executive levels. What this means is that even if the centre were to work with a clear objective in mind and with a concerted push, there are still too many factors outside the Centre's control that would still need act as impediments.

It is important to understand that while huge companies hog the media landscape, around 80% of the economy and jobs are centred on Small and Medium Enterprises. The biggest beneficiaries of every slight improvement in the business environment will exponentially improve their productivity and addition to the economy. It is difficult if not impossible to imagine how the Centre will be able to deliver a serious bump in India's rank from 134, forget breaking among the top 50.

By the way, if India were to break into the top 50, who will have to be better? How about India being better than Spain (52), Italy (65) and China (96) (all lie between India and the top 50)? Is it likely that India will have better courts, state organs, laws and efficiencies than EU nations and China? Even if it is, it is doubtful that such a sea change may come about in the next three years.



Dayananda Kamath k

3 years ago

by removing congress, mayavathi, mulayam, dmek by people and jayalalita and mamta by court orders and installing of narendra modi might have already imporved the ranking by atleast 100 ranks.

Dr Anantha K Ramdas

3 years ago

This is not a pipe dream that Premier Modi has had; it is practical to achieve provided everyone feels the same way.

We talk of corruption as the root cause for all our troubles. Yes it is true, but then, like charity begins at home, we start and practice corruption at home early in life. And then, the size and activities of this deadly disease grows with our age.

Take our own child at home which is not eating the food or refusing to drink his/her milk. What does the mother do? After her usual show of love and affection, she "bribes" the child by saying: "ok beta, drink your milk, I will give your a nice ice-cream, chocolate, toy or whatever!"

When the boss gives you a job to do, anywhere, his words are: "get this done, I don't care, how you do it!". The clerk goes about trying to do the job, and, in the end, to get a pat in the back, he would give a "bakshis" to some other guy in the chain, and get this done. In due course, he learns to "add" a bit on the "bakshis" for himself. This is the way everything is done.

Babus make rules in the office and create "impediments" in the process, so that, they can "come to your rescue (at a cost, of course) so that the job gets done. This way the list is endless.

Like the article rightly points out, why should have hundreds of forms to fill, process, obtain this, that and some other "approval" before anything is done? If the British taught us English, for which we should be forever grateful, they also made us a bunch of clerks, and laid down procedures, so as to set their own importance for "approving" things.

The first step for Narendra Modi should really do is to have a some serious action on simplification of procedures everywhere. Like he said in the madison square garden, he should simply "delete" all the archaic laws and replace them by simpler and practical ones.

With him at the helm, we have taken a first giant step; it is possible to achieve many of his dreams, if we all wake up from our slumber and be part of it. He can start by bringing about the change, state by state. We can have a 3/4 years plan to complete and this is possible.

Mahesh S Bhatt

3 years ago

Naya Naya Modi Naya Naya Khwab.

God also can't bless

But he his marketing hard & working hard.


J Thomas

3 years ago

A journey of a 1000 miles starts with one step. Unless we try, we will not progress. Even if we don't reach the top 50, we may reach the top 100. That would be a huge improvement.


3 years ago

Many businesses will do much better and invest more if there is respect for law and speedy justice in the country. Availability of more skilled workers and simpler labour laws will certainly help. Better infrastructure will do the rest.

So government should concentrate on having simpler laws, enforcing them well, improving education and infrastructure.

Rutvik Pathak

3 years ago

We get emotionally carried away, When I started reading this I initially thought at-least someone is talking to be in top 50....

Reality is we should set realistic goal, And Way I see the system which was made and was running from last 60 years cannot be changed overnight.....

I completely agree with the author when he calls PM's dream a pipe dream....

Sankar Amburkar

3 years ago

This can be implemented first in BJP ruled states such as Madhya Pradesh, Rajastan and Gujarat. If it succeeds and takes investment from the other states, other states have no option other than to fall in line and provide similar facilities to attract investment.

Anand Doctor

3 years ago

A thousand kilometre journey must begin with the first step.
Only we when dream, will we attempt. Only when we attempt will we succeed. So we must go forth with a positive attitude and patience if we are to have any hope of changing things for the better!

Suiketu Shah

3 years ago

I expect significant positive change once Dr Swamy officially gets into the thick of things.Unfortunately the present FM's health is very bad,cant see him continuing too long.

Gopalakrishnan T V

3 years ago

if there is a will there is a way. nothing is impossible provided, the mindset is there to achieve the target with suitable action.


3 years ago

Why we are forgetting to dream big.. we start worrying about is this possible ?

Dream big, god will give a way to archive...

MG Warrier

3 years ago

Studies and rating agencies make 'wild' comparisons. If Modi succeeds in driving in the need to compare comparables and get India ranked among nations which have population equal to, say at least equal to the most populous state of Tndia, or among nations having GDP of at least 20 per cent as much as India's or among countries having per capita geographical area equal to or less than that of India's India's ranking will be different!


3 years ago

Kiya desh ke chhote chhote udhyog sahasik ke liye Jo jat bhat ni red tap lagavi chhe digital india KI baat ker rahe ho to pehle DESH me Se afsar shaahi khatam karo AUR khali khali bhapka WALA faltu kharcha bandh Karo keise SEWAK HO JISKE AANE SE LOGO KE RASTE BANDH HO JAYE


3 years ago

Kiya desh ke chhote chhote udhyog sahasik ke liye Jo jat bhat ni red tap lagavi chhe digital india KI baat ker rahe ho to pehle DESH me Se afsar shaahi khatam karo AUR khali khali bhapka WALA faltu kharcha bandh Karo keise SEWAK HO JISKE AANE SE LOGO KE RASTE BANDH HO JAYE


3 years ago

Local native faceies lots of deficulty sp. SME'S
Gharna Chokra Ghanti Chate Padoshi ne aatto

India is an opportunity, PM Modi tells foreign investors

Prime Minister Modi, while launching his 'Make in India' campaign to boost domestic productivity, assured industrialists that they will not lose their money


Prime Minister Narendra Modi on Thursday launched his ambitious 'Make In India' campaign aimed at inviting foreign companies to produce and export their products from the country.


"Manufacturing boost will create jobs, increase purchasing power, thereby creating larger market for manufacturers. Industrialists don't come because of incentives. We need to create development and growth-oriented environment across the country," Modi said.


Assuring industrialists, especially from overseas, Modi said they will not lose their money (after investing in India) because India is an opportunity.


Not just good governance, effective governance, easy governance need of the hour, the PM added.


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