Chennai, Feb. 3
INDIA cannot afford to by-pass the manufacturing sector and move directly to a service-oriented economy from an agrarian economy, according to the Union Minister for Communication and Information Technology, Mr Dayanidhi Maran.
Addressing the golden jubilee convention of the Madras Management Association here on Friday, Mr Maran said that despite the growth in economy in the last decade, the contribution of the manufacturing sector to national income has only increased to 17 per cent from about 15 per cent.
Ideally, its contribution should range around 25 - 30 per cent, which would mean that the sector has to grow at about 12 per cent a year over the coming decade, he said.
He said the growth in manufacturing sector holds the key to generating employment. India can be a leader in areas such as information and communication technology, agri-processing, knowledge-based industries and leather.
The Government was committed to encouraging investments by reforming the public sector and through public-private partnerships, he said.
The Tamil Nadu Governor, Mr Surjit Singh Barnala, said that greater growth was needed in food production and manufacturing to meet the needs of the growing population.
The growth in production should be related to the improvement in living and working conditions of the people.
Mr D.P. Padmanabhan, President, Madras Management Association, said in his welcome address that the manufacturing sector was continuously expanding. Apart from the domestic market, companies were establishing a presence overseas. In the first nine months of the current year, over 62 operations involving investments of $1.4 million had been set up overseas.
Multinationals such as Nokia and Intel were coming to India, and Boeing was considering setting up a Rs 20,000-crore servicing facility in India, he said.
Mr C.K. Ranganathan, Chairman, Convention Committee, and Chairman and Managing Director, Cavin Kare Pvt Ltd, said that India has evolved from being a "buyer of technology to a buyer of companies." The boom in the stock market was an indicator of the confidence that international players reposed in India.