Economy

Centre extends ₹580 cr lifeline to capital goods sector

R Yegya Narayanan Coimbatore | Updated on November 27, 2014 Published on November 27, 2014

The Centre has extended a near ₹580 crore life line to the capital goods sector that plays a key role in the manufacturing chain by launching a scheme to make the Indian industry globally competitive.

The proposed `Scheme for Enhancement of Competitiveness of the Capital Goods Sector’ seeks to address the issue of `technological depth creation’ in the capital goods sector apart from formation of common industrial facility centres.

A gazette notification issued by the Ministry of Heavy Industries and Public Enterprises (Department of Heavy Industry), GoI, on Nov 5 pointed out that if the capital goods sector was provided with the necessary support, it would `go global soon’.

Otherwise, the country would turn into a global `dumping ground’ for second hand machines and the country would become the largest importer of machines and components. The prominent seven sub sectors included machine tools, dies and moulds, textile machinery (including jute machinery), heavy electrical, mining and construction, metallurgical and process plant equipments and plastics machinery.

The notification pointed out that the prominent sub sectors have a demand worth ₹2.90 lakh crore. Of this, domestic production was valued ₹1.85 lakh crore and exports ₹46,000 crore. But the imports were valued ₹1.51 lakh crore. The sector employs directly 1.4 million skilled people.

Listing some of the major constraints faced by the sector, the ministry notification pointed out lack of technology upgradation and modernisation, lack of cutting edge technology and R&D support, shortage of skilled manpower and industry disconnect with technical institutions as some of the major constraints faced by the sector. This had made India the largest market for imported capital goods while the `domestic capacity after upgradation can produce the same’.

Highlighting the benefits of the proposed scheme, the ministry said that the scheme would `encourage investment in technology upgradation, skill development and augmentation of modern manufacturing capacities’ for the growth of the sector. It also seeks to mitigate the impact of some of the constraints faced by the sector and improve their competitiveness. It also envisaged action in synchronisation with the 12th five year plan `for rejuvenating growth in manufacturing sector’.

The proposed scheme envisages Government investment of ₹581.22 crore during the current five year plan (12th FYP), much of which would go for creating permanent technical services and common facility centres. The objective of the scheme was to give a boost to the Indian economy by making the Indian capital goods sector globally competitive.

Published on November 27, 2014

A letter from the Editor


Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.