Minister states emphatically that global outsourcing does not lead to job losses
CII Partnership Summit 2014 kicks off in Bangalore
Building global partnerships and value chains is a continuous and irreversible process that will be unhindered even if some countries adopt inward looking policies in the face of economic challenges. Stating this in his inaugural address on ‘Emerging Global Value Chains: Building Partnerships’ at the three-day CII Partnership Summit 2014 being organised in Bangalore, Mr Anand Sharma, Minister of Commerce & Industry, Government of India, said emphatically that global value chains by their very nature do not cause loss of jobs in countries that outsource manufacturing and service functions. Mr Sharma referred to a recent study that said that for every job outsourced by the US, two new higher-end jobs get created in the country.
Underscoring the irreversible nature of emerging global value chains, Mr Sharma said that over 60% of Fortune 500 companies have set up their global R&D centres in Indian cities like Bangalore. This number will only increase, he said.
Noting that Government of India has opened up a gamut of domestic sectors to foreign direct investments (FDI), Mr Sharma said that that in the last four years alone India received FDI worth $176 billion. He added that the National Manufacturing Policy (NMP) that was introduced in 2011 will catalyse greater FDI inflows as the country prepares to develop 17 National Manufacturing Investment Zones (NMIZs). He also referred to the development of industrial and economic corridors like the Delhi Mumbai Industrial Corridor (DMIC), proposed economic corridors between Bangalore and Mumbai, Bangalore and Chennai, and dedicated freight corridors to illustrate the new developments in India that will be of key essence to global investors.
Mr Sharma said that India has entered into several bilateral trade agreements with countries and regions around the world. Now the focus is on accelerating the partnerships with Asia which as a region is undergoing a new wave of economic integration.
The minister said in his closing remarks that India is forging a strong skills base, which will not only meet the country’s future needs but also help bridge the estimated global skill shortage of around 85 million in the future.
Mr Siddaramaiah, Chief Minister of Karnataka, said in his keynote address that Karnataka is one of the fastest growing states in the country and that Bangalore is integrally linked with the global value chains. Noting that the city is already a global hub for design and R&D, Mr Siddaramaiah expressed satisfaction over World Economic Forum (WEF) identifying the city as one of the Top 4 innovation hubs in the world. The Chief Minister added that while the state has taken strident steps to drive the growth of IT/ITeS, biotech and other service industries, the state government is now directing sharp focus on manufacturing growth.
Karnataka has set up a Manufacturing Task Force. Mr Siddaramaiah said the state is aiming to become one among Top 3 destinations for investments in the manufacturing sector. He said that while one NMIZ is coming up in Tumkur, three other NMIZs will come up in Bidar, Gulbarga and Kolar. The state’s New Industrial Policy which will be released in April this year will provide further impetus for boosting manufacturing growth in Karnataka.
Mr Siddaramaiah also stated that the world’s first digital media city is coming up in Bangalore. He cited tourism as another big business opportunity in the state, and added that Mysore is emerging as a major business and investment destination. During the session a report on Roadmap for Industrial Development of Mysore was released by Mr Anand Sharma.
Mr Kaushik Mukherjee, Chief Secretary, Government of Karnataka, said in his address spoke about the investment avenues available in Karnataka. Tourism of Karnataka can play a major role for bringing in foreign investments to the country as Karnataka is rich in biodiversity. Other than IT, biotechnology has also taken strong roots in Karnataka. He also spoke about developing country-specific export zones for global businesses.
Earlier, Mr S Gopalakrishnan, President, CII and Executive Vice Chairma, Infosys Ltd, referred Bangalore as the hub of knowledge. He thanked Mr Siddaramaiah for his support to industry and for his innovative ideas offered to make Karnataka the hub of Industrial Development. Explaining Partnership and Global Value Chain in the true sense where products are manufactured in one part of the world, assembled in another and sold in another part of the world, he said it was very important for the world to come together, have policies that integrate the chains of globalisation.
He also explained how India plays an important role in connecting with the value chains as the nation meets global standards of industrialisation in all the sectors, especially in IT. He focused on the ground rules that will strengthen the GVCs -- connecting infrastructures worldwide, skill development and training programmes for smaller sectors, cross border trade facilities, giving greater importance to MSMEs and facilitating them by open financial regime and services to be brought in action in a robust manner are a few to mention.
Mr Ajay S Shriram, President Designate, CII and Senior Managing Director, DCM Shriram Consolidated Ltd, proposed the vote thanks. Mr Chandrajit Banerjee, Director General, CII, anchored the session.