The impact of Make in India on German SMEs

Prime Minister Narendra Modi had launched a ‘Make In India’ mission, which has had a huge impact on the Indian industry. With the Minister’s visit to Germany in 2015, various German Companies showed interest in being a part of the ‘Make In India’ program. With the support of the Government of India and the Indian embassy located in Berlin, a Make in India Mittelstand, which is a strategic investment support program, was announced in September 2015. This investment program was aimed at helping German small and medium scale companies to enter the Indian market. Currently, the program is supporting 72 German Small and Medium enterprises with an approximate investment of €650million, the program has successfully generated 4000 jobs in India. 

This program had an impact across 72 sectors, which can be broadly categorized into Industrial, Environment, Infrastructure, Mobility, Consumer Goods, Aerospace, Security, Pharma and Packaging. Various industries across the sectors have been benefitted. Under the MIIM program, various companies are provided support through workshops on topics like, ‘Economics of Localisation and Sourcing in India’ and ‘Location Assessment and Investment Zone Options’. The workshops help the companies prepare in advance before they enter a market in India. The program also offers webinars to generate comfort and ease for companies willing to enter the Indian market. The program has been designed to act as a ‘Local Fast Track’ for companies willing to enter India. This basically has an impact on 11 expansion projects, 31 manufacturing plants and two pilot projects in the short term and the medium term period.

Many German companies have successfully entered India through the program and about 40 companies are at an advanced stage in terms of their market entry into India. The program assisted Verbio, a German manufacturer and supplier of biofuels to choose a state for the pilot plant and also helped in its incorporation in the Country. Similarly, various companies have been benefited with this program.

Currently, MIIM has multiple partners that enable quick incorporation and helps companies who face challenges in terms of land allotment, location analysis, market assessment, technical feasibility and transparency on tax legalities. Its partners include EAC-Euro Asia Consulting) for strategic, M&A, operational market entry support; Invest India, the Governments of Gujarat, Karnataka, Maharashtra, Madhya Pradesh, Rajasthan, Tamil Nadu, and West Bengal; Khaitan& Co., and Rodl & Partner for legal & tax support; Global Innovation & Technology Alliance – GITA for technology collaboration services; German Centre Delhi, Gurgaon for location support; State Bank of India, Deutsche Bank and DEG for financial services support, and Indo-German Chamber of Commerce-IGCC and Deutsche Messe and TUV Rheinland.

The program is seen as a huge step forward in the implementation of the ‘Make in India’ initiative and has introduced new technologies, generated employment and facilitated FDI across various sectors in the Country. Various Governments across the nation have emerged as a strong supporter of this program and have benefited in return. The ‘Make in India’ initiative has left a positive impact on local industries as well as German SMEs.