Make in India to deal with price-sensitive market

The Indian market is well-known to be price sensitive. This necessitates the foreign manufacturers to keep the products as affordable as possible. Incidentally, the Indian government’s “Make in India” scheme, to encourage manufacturing within the country, will help foreign companies achieve just that.

Low labor costs, low costs of setting up manufacturing plants, and access to the world’s largest population of young people are some of the advantages often cited to making in India. But perhaps the most significant incentive would be avoiding taxes.

“One of the goals of ‘Make in India’ is to try and get the costs down by tapping the large technical resource base, and drive import duties and related costs down, which are substantially high at this point,” Ranjit Nambiar, Director for India and SAARC at HID Global, said. “If you add up such costs for security products, it comes to about 30 percent. Once you bring these costs down, the products are more affordable and market is easier to penetrate.”

From a marketing perspective, manufacturing in India will also help companies align themselves to the national sentiment to boost the local economy. It will also help companies take advantage of the various incentives that the government continues to roll out to encourage local production.