Budget 2021 Expectations: PLI a ‘landmark’ policy, Govt must now push for R&D in India, says Lava International

Calling the Indian government’s Production-Linked Incentive Scheme for Large Scale Electronics Manufacturing (PLI) a ‘landmark’ policy, Lava International president and business head Sunil Raina told Financial Express Online that with make in India in place, the next frontier should be research and development (R&D) in India. This is because the real value is going to come from innovation—not just from manufacturing which is mostly labour-intensive work.

“And those innovations, unless and until they come out of India, may not be able to add much value to the world,” Raina said adding, “if India has to become a country which adds value to the world, then R&D should be one of the key focus areas that the government should push for (now) and that is what we expect it to do.”

Interestingly, that seems to be the ‘general’ opinion of most people. A Twitter poll that Financial Express Online ran recently showed over 50% people inclined towards ‘R&D in India.’ Nearly 32% said they would rather see India making for the world and while that is surely a notable thing to aspire for, building and improving skills might just have even more far-reaching implications, something that Raina also pointed out.

#Budget2021withFE | With ‘make in India’ in place, Govt’s next frontier should be:

— FinancialXpress (@FinancialXpress) January 20, 2021

Giving the analogy of India and China, Raina said it’s easy to understand why India could simply not do what it was doing today, in terms of manufacturing/designing, say 10 years back.

Through the 80s and beyond, China built skills to supply goods to the rest of the world, while India remained a trading economy—largely. Even Lava started off by manufacturing in China because “phone making skill was just not there in India whether it be manufacturing or design or software.”

Change is in the air now and India is trying to do “the same thing that China did in the 80s.” But there is still a lot that needs to be done.

“You have to create your own employment opportunities and for that, new skills have to be learnt. I am sure the government would also be already realizing this.”

Speaking of PLI, which is a “done deal,” Raina said, “from our perspective yes, it’s a very good incentive program which is going to help us really strengthen our infrastructure, because it has got incentives on one side, and a commitment (from our end) in terms of investments on the other—this is a very fair system wherein you know you are also supposed to work really hard towards achieving certain numbers.”

The $5.5-billion scheme has opened the potential for brands—especially home grown—to build a sprawling ecosystem in India for mobile phone manufacturing, something that has pushed other brands to demand a PLI-like scheme for other verticals including smart TVs, wearables, and AI/IoT products.