Big New Move From PM Modi Soon For Industry Ahead Of 2019 Election

Prime Minister Narendra Modi plans to unveil a long-awaited industrial policy soon to boost domestic manufacturing and accelerate economic growth before central polls next year. Under the new plan, a company need not purchase land or equipment but could lease them on long-contract basis helping lower costs and cut down time on setting up operations, secretary to the Department of Industrial Policy and Promotion Ramesh Abhishek said in an interview. Units located in industrial clusters may be able to share infrastructure.

"We have to be competitive," said Abhishek, whose ministry has been working on the plan for over a year. "For this we need to upgrade our technology, lower costs, improve logistics, skill our labour. The industrial policy will bring all things together and will come out with recommendations on what needs to be done."

PM Modi's administration has been struggling to fulfill one of his key campaign pledge -- creating 10 million jobs a year-- that propelled him to power in 2014 elections. As the country heads to the poll due early 2019, the main opposition Congress party is moving to cash in on the disenchantment over unemployment and rising social tensions.

The reform, likely to be one of the last few measures before PM Modi seeks re-election, attempts to attract over $100 billion in investments into the country and kick start the economy. Quarterly growth is expected to have slowed in the three months ended September even as a liquidity crunch at banks hurts business sentiment before state elections.

Rules will be eased for small and medium businesses which constitute more than 90 per cent of Asia's third-largest economy. The country jumped 23 places to the 77th position in the World Bank's global ease of doing business rankings announced earlier this month.

The government is also completing work on the $100 billion Delhi-Mumbai Industrial Corridor that has been delayed by a decade. Work on $2-billion worth of projects has been completed with companies being allotted land to set up factories.