India’s manufacturing sector needs to innovate, finance ministry’s principal economic adviser Sanjeev Sanyal said, adding that though there is space for failures, the consequent bankruptcy need not be treated as a stigma.
“More broadly society needs to understand that innovation around entrepreneurship is about bubbling mix of entrepreneurship where things will go wrong for no particular bad reason and bankruptcy is not a stigma,” Sanyal said after releasing the FICCI-PwC Strategy & India Manufacturing Barometer survey.
He further said that small and medium enterprises, a segment of the economy that by its nature is much more flexible could innovate much faster if given an opportunity. “One of the frameworks is that we are going to get into environment where we are much more innovative and it also means there will be more failures,” he said.
India needs a culture of innovation and also requires a culture which accepts bankruptcy, he said, adding, innovation is dependent upon some of it failing.
Sanyal said that the country needs a responsive policy regime rather than a stable environment to define a completely different way of thinking of policy making.
He added that industrialisation in the country was taking place at a time when manufacturing was changing radically, making old jobs redundant and giving way to new kind of openings. Also, with the Indian economy greatly disbalanced with a dominant services sector and agriculture and manufacturing sectors lagging behind considerably, Sanyal said the country needs to adapt to the global changes. “We also need to be cognisant of the fact that the future of industrialisation may not be export-oriented. We need to adapt to a new world and that is the constraint that we face,” Sanyal said.
He further said that there was a need to engage in vigorous debates to resolve the aforementioned issues and the effort should be towards building a responsive policy environment.
The FICCI-PwC Survey expressed optimism regarding the Indian economy, stating that the country continues to remain an economic bright spot amid global slowdown.
But the outlook for the Indian economy and its core sectors continues to remain upbeat in 2016-17, it said, adding, as the government plans to undertake large-scale policy reforms, the overall economic climate remains favourable.