Make in India : the Most Significant & Relevant Initiative of the Government
With the Centre opening up various sectors for FDI, TUV Rheinland, a global provider of technical, safety and certification services, is extremely bullish on India.
In a conversation with BusinessLine, Thomas Fuhrmann, Managing Director – India, talked about how the German firm is trying to partner with the Indian government in the skill development area and about the company’s investment plans in the country.
Q. How have the last two years of Modi government changed the business environment for you? Do you see things changing from an ease-of-doing-business perspective?
The new government has planned as well as started many initiatives. We, as a testing, training, inspection, certification and consulting company, strongly believe that Make in India is the most significant and relevant initiative which acts as a catalyst for our business in the present and future.
The vision and way ahead for making India a globally recognised and competitive manufacturing hub is a very smart move by the Modi government, as it will attract many global players to set up their operations in India.
The Make in India programme is a great boost for us as it will interest global players to set up production units in India and export to countries in Europe, the US, Middle East, Gulf countries, South-East Asian countries and many more.
Unlike India, these countries have strong as well as strict quality and safety regulations. We, as a certification and inspection agency, can help them meet these regulations as per international standards. This definitely changes the perspective of doing business in India.
Q.What are some of the major challenges you still see in India for businesses?
In India, the end consumers are concerned about quality and safety but are less informed about how to identify if the product is meeting international standards. The government has to impose strict guidelines on quality and safety to ensure not only that the product is safe but also that the environment is less affected.
In the renewable energy sector, there are challenges with respect to the RPO (renewable purchase obligation).
Some States have increased their RPO; however, there are still many States that have to give their consensus. This indirectly affects our renewable industry business as increased RPO will attract more players in the business.
On the contrary, the government is also taking steps to impose strict policies on quality and safety. In 2015, the BIS (Bureau of Indian Standards) had passed a compulsory registration scheme under which 30 electronic and telecommunication products were listed.
TUV Rheinland India was India’s first laboratory to get a BIS accreditation to certify electronic and electrical products. Furthermore, recently, the ISSDA (Indian Stainless Steel Development Association) also introduced the Stainless Steel Quality Control Order wherein any domestic or foreign producer has to get a BIS marking on the relevant grades.
Therefore we see the new government is taking good steps towards creating regulations on quality in various sectors. The demand for qualitatively excellent and certified products is so elementary that these regulations are supportive to boost exports by Indian economy.
Q. What would the increased FDI limit in various sectors mean for TUV Rhineland? Would you be looking at making new investments in India in the near future?
As per the DIPP (Department of Industrial Policy and Promotion), FDI limit has been increased in sectors such as mining, petroleum and natural gas, civil aviation, infrastructure telecom, railway, etc. We have ample opportunity to serve these industries directly or indirectly.
We feel with the new development by the government, the economy has opened up to invite global giants to be partners in growth.
We can observe that there are many projects being initiated by international companies and we can offer them product and system certification, quality control, provide training to their employees as well as supply skilled labour and many more.
We invested a huge amount in operational infrastructure such as offices, laboratories and training centres and we have similar plans in the coming years. We are investing in a new headquarter in Bangalore, wherein our major office and all our laboratories except the EMC, will be under the same roof.
We are also planning to open new offices and laboratories as well as to invest in 50+ new training centres all over India.
Our investment plan for the year 2017 covers approximately over €2.5 million (about ₹18.66 crore).
Q. What would be your core focus areas next year?
We would definitely like to focus on our Academy & Lifecare business which deals with training. The government has a target of training over 400 million skilled people by 2022. We feel that the government has a very ambitious target and we will partner it in achieving the targets. We also have some projects partnered with the government.
We will also concentrate on Product Safety, under which we extend the scope in the field of renewables including solar photovoltaics, IT infrastructure as well as wireless.
Are you looking at working with the government on the various skill development initiatives? What are the other areas that you’re looking at engaging with the government?
I would like to take this opportunity to talk to you about this MNRE project on “Suryamitras”. The government has a target of creating 50,000 “Suryamitras”, or skilled manpower in the solar energy sector, over tyears.
We are the leading technical service provider for the solar industry wherein we work closely with investors, owners and manufacturers to understand their complexities and provide them with solutions. With this experience, we are committed to help MNRE create 50,000 “Suryamitras”. We plan to create 50 training centres to aid the project.
We want the government to look at us as a service provider for imported as well as exported goods, infrastructure projects, etc.
We would like to support the government in taking better steps towards environment protection, education and skill development and in the field of renewables.