Here's How Modi's 'Make In India' Plan Can Revive Manufacturing

A Balance of industry and residence:  The “Smart Cities” initiative will need a strong development strategy to incorporate manufacturing and residence set up for the workforce. This balance will need utmost importance as the present Indian cities infrastructure does not provide a good distinction between manufacturing sector and residence.

The special economic zones need regulations that will have a proper ecosystem balance.

Taxation regulations: The manufacturing sector contributes just 16 percent of the annual GDP even though they pay more excise duty tax and service tax. In India, excise duty tax is region specific or state specific, this leads to a lot of tax jumping. Investors look for windows where they are either exempted from tax or can pay less and thus move on to that region or state.

This leads to corruption and tax complications. Excise benefits must be according to turnover and profit and not region specific. For this to stop the government must look at a wide angle smart taxation method. 

Numerous tax problems: Manufacturing sector pays various other taxes like sales tax, octroi and entry tax to name a few. The problem here is that GST is yet to be implemented that means the manufacturing sector will have to continue with the numerous taxes that they are bound to pay, creating problems for investors as well.

The government needs to implement the GST as soon as possible.

Bearing the brunt: The Manufacturing sector bears the extra cost for farmers so that they can be given free electricity supply, which is about 60 percent more than the usual percentage of tax. This means that they lack power supply hence there is burden that adds to the cost of production and competitiveness.

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