New Delhi: The central government introduced the Production-Linked Incentive (PLI) scheme in 2020 in a bid to push domestic manufacturing. It started with three sectors – mobile, electrical component and medical devices – and now it has been expanded to include 14 sectors with an outlay of Rs 1.97 lakh crore ($26 billion). In an interview with DH’s Gyanendra Keshri, Chairman of MMG Group Sanjeev Agrawal, who recently took charge as President of PHD Chamber of Commerce and Industry (PHDCCI), underlined the need for expanding the PLI scheme to include more sectors. He also elaborated on industry’s concerns and expectations from the interim budget 2024-25 and McDonald’s expansion plans in north and east India. Edited excerpts:
Taking charge as the president of a chamber of commerce and industry, what are the key challenges you see facing businesses today?
We at the industry chamber appreciate the concerted efforts being taken by the government for ease of doing business and various associated reforms. However, despite these targeted initiatives, costs related to several aspects of business remain a big challenge. It includes the cost of compliance, cost of land, cost of logistics, cost of finance and cost of power. These need to be addressed. The current trajectory demands a strategic focus on Small and Medium Enterprises. Primarily, augmentation of their size and scale, coupled with expanded financial outreach, will be instrumental. Simultaneously, streamlining the ease of doing business at the factory level, along with bolstering local and global value chains, remains imperative. Decriminalising minor offences, perpetually reducing the compliance burden, besides nurturing the skill development, capacity building, and technological capabilities of MSMEs are integral to this pursuit.
What are industry’s key demands and expectations from the upcoming interim union budget?
We are looking forward to a budget that can stimulate economic growth and foster a conducive business environment. Infrastructure plays a crucial role in economic development. We urge the government to boost investments in transportation, energy, telecommunications, and digital infrastructure, along with a focus on improving the ease of doing business through simplified regulatory frameworks and reduced bureaucratic complexities. PHDCCI also emphasises the need for a robust emphasis on skill development and education, highlighting the importance of aligning the workforce with industry requirements.
In order to stimulate industry there is a need for dedicated local personnel who can handhold the startups with respect to streamlining the entire process from cradle to grave, more thrust on regionalisation especially the rural areas and the internal parts of the country is required. The PLI should be expanded beyond the 14 sectors to include medicinal plants, handicrafts etc. Additionally, extreme support of marketing platforms, dedicated SEZs (special economic zones) for startups and MSMEs is required.
What needs to be done to further improve the ease of doing business?
There is a need to focus on tier 2 and 3 cities. There is a need to create a unified platform for businesses to interact with each other horizontally and vertically for intra-industry and inter-industry trade domestically, to enhance efficiency and reduce duplication of activities. To enable further expansion and competitiveness of MSMEs, there is a need for fiscal incentives and, to put in place, a robust support mechanism.
What are the expansion plans for McDonald’s in the region where you lead the franchise?
Since taking over McDonald’s franchise in North and East India in 2020, we have remained focused on developing the brand in the region, modernising existing restaurants with contemporary, consumer-centric ambience and layout. Currently we have close to 180 restaurants in the north and east region. Our target is to increase this number to 300 in the next 3 years. We entered 2 new states last year - Odisha and Assam. McDonald’s Guwahati is the largest restaurant in our region, spread across 6,700 sq ft with a capacity of 220 people at a time. This year, we are targeting to open more than 35 new restaurants.