Turning industrial policy into investable industrial ecosystems

The Indian government has unveiled a comprehensive roadmap titled Viksit Bharat 2047, aiming to transform India into a developed nation by the centenary of its independence in 2047. Central to this vision is achieving a 10-trillion-dollar economy, which would mark a significant leap from the current GDP of approximately $4.5 trillion. To reach this target, the government outlined several strategic initiatives, including doubling India's share of global exports from around 2 percent to 10 percent and substantially increasing foreign direct investment (FDI). These goals require sweeping economic reforms in sectors such as land, labor, power, agriculture, infrastructure, and regulatory frameworks. The plan emphasizes not just economic growth but also inclusive development. While GDP expansion is essential, the government stresses the need for growth that benefits all segments of society, particularly the underprivileged. Initiatives like the Pradhan Mantri Garib Kalyan Yojana are highlighted as steps toward this end. However, the government acknowledges that creating jobs for the youth is a pressing priority. It proposes fostering an entrepreneurial culture among young people, enabling them to generate employment rather than merely seeking it. This shift is seen as vital to addressing persistent economic inequalities and promoting a more equitable society. Education reform is another cornerstone of the Viksit Bharat 2047 strategy. The current education system, criticized for its reliance on rote learning, is deemed inadequate for preparing students for a modern, knowledge-based economy. There is a call for increased emphasis on vocational training, industry-academic partnerships, and the integration of technological skills, including artificial intelligence, into curricula. Public and private investments in education, particularly in regions lagging behind the national average, are expected to rise sharply. Additionally, research and development must be prioritized across educational institutions to harness the potential of India’s large and youthful population as a demographic dividend. Healthcare is also a focal point of the initiative. The government has launched programs such as Ayushman Bharat and Ayushman Arogya Mandir to improve access to medical care. These efforts have led to a notable increase in the number of medical college seats, helping to address the doctor-patient ratio imbalance. Moreover, India has positioned itself as a destination for medical tourism. Nevertheless, challenges persist, including insufficient public health spending and the rising prevalence of chronic diseases, which strain the healthcare system. Meanwhile, in South Africa, the government faces its own set of challenges related to industrial development. Over the past three decades, the manufacturing sector’s contribution to GDP has declined from about 21–22% in the early 1990s to roughly 12–13% today. Recent data indicates a further decline in manufacturing output during the first five months of 2026, raising concerns about the sustainability of economic growth. The Manufacturing Indaba, a forum aimed at promoting industrialization and strengthening local manufacturing, is currently underway in Johannesburg. This event brings together sector participants, investors, and stakeholders to discuss strategies for revitalizing the manufacturing base. Manufacturing remains a critical driver of economic growth in South Africa, generating indirect economic activity worth nearly twice its direct contribution. Each rand invested in manufacturing generates approximately 2.38 rands in additional economic value, while each job in the sector supports 3.34 jobs overall. Despite automation reducing direct employment, the sector continues to play a pivotal role in job creation and economic stability. The government recognizes that industrial policy must focus on building productive capabilities, fostering innovation, and enhancing competitiveness. Success hinges on the synergy between manufacturing, services, infrastructure, technology, and human capital. The National Industrial Policy Framework (NIPF) and subsequent Industrial Policy Action Plans have sought to guide this transformation, yet implementation has been hindered by a lack of coordination among policy instruments. Fiscal, monetary, energy, transport, technology, and regulatory policies have not always aligned effectively. The Industrial Development Strategy (IDS) reflects the government’s acknowledgment of the ongoing importance of manufacturing and industrial development. A proposed coordination platform within the presidency aims to streamline these efforts, ensuring that diverse policy levers work cohesively toward shared objectives.