The Budget 2022 comes at a very crucial juncture as the Indian economy is gradually recovering from the impact of the COVID-19 pandemic and gathering momentum amidst the looming uncertainty, volatile environment, caused by various disruptions, high inflation, and geopolitical tensions.
Tata Technologies is at the cross-section of the intersection between the manufacturing industry where we work with OEMs to develop innovative solutions that enable efficient manufacturing of products and the engineering service provider industry, which harbours the potential talent to innovate in India for the world. Both these industries have experienced significant volatility with supply-side and demand-side challenges in the recent past.
The semiconductor chip shortage is the biggest pressing issue that India, as well as the global manufacturing industry, is facing, with uncertain supply forecasts creating bottlenecks in meeting demand. Disruptions due to the pandemic, new technologies, and regulations are redefining mobility like never before. However, at the same time, factors like inflation, the emergence of the third wave, and rising cross-country escalations are hindering the resurgence of the industry.
The global impact of COVID-19 has accelerated technology and digital adoption across industries. It has also paved the way for hybrid work environments, heavily reliant on technology-led solutions, and Engineering Service Providers are facilitating this eMobility and Digital transformation to help organizations be ready for the future. However, talent availability continues to be a major challenge along with the issues being faced by the customers in the manufacturing industry.
At this juncture, the Budget could be the right trigger to spur growth and innovation.
Here are my three recommendations from Budget 2022-2023, which I believe could possibly help address the supply chain challenges as well as impel investments in the Indian industry:
Investments in evolving technologies
For boosting job creation, India’s production capabilities need to be improved for which technological evolution is imperative. The government should provide significant incentives to enhance investments in R&D and technological advancements at a time when many of the manufacturers are looking at uncertainty in supply and demand.
The government’s Make in India initiative should be extended to Innovate in India, and Research in India. India needs to build its reputation as a leading innovation hub. Engineering service providers should be encouraged to ‘innovate-to-evolve’ through various incentive programs to study, research and develop new technologies for an Innovative India. This will not just help the companies in India but also attract global manufacturing companies to set up a base in India as they would like to leverage the innovations and technologies incubated in India.
Investments to capitalize on eMobility trend
eMobility is the way forward. India is a signatory to the Paris climate agreement. However, the realisation of the ‘green goal’ would require investment in technology that will help drive this transition at a time when many of the companies are still recovering from COVID-19. The Indian government needs to bestow renewed impetus on the ongoing e-mobility trend and increase adoption of other renewable energy sources.
The government needs to fuel up the charging infrastructure by allocating a higher budget for the same as well as incentivise investments in EV technology by the entire eMobility ecosystems including OEMs, Tier 1s, ESPs, Renewable Power, etc.
The author is CEO, Tata Technologies. Views are personal.
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