The label “Made in China” can be seen virtually anywhere today, tagging consumer goods around the world.
But despite China’s meteoric rise during the past decade, other emerging economies are catching up and looking to tools that will accelerate their growth: for one, India and its small-but-mighty manufacturers pioneering the use of cloud technology.
Manufacturing in India has historically shadowed that of China. In 2014, manufacturing accounted for only 13 percent of India’s economy, compared to China’s 30 percent. China has since commanded 22 percent of all manufacturing and export business. But if both countries offer extremely cheap labor, why haven’t companies flocked to India? The answer lies in the nation’s regulatory burden and lack of infrastructure, including unreliable energy lines and poor transportation networks.
With wage hikes dimming China’s appeal in recent years, India’s government has embraced the challenge of fixing these issues. Just over two years ago, Prime Minister Narendra Modi undertook a major initiative designed to shape the country into a global manufacturing hub.
Aptly titled Make in India, the campaign was widely heralded as a bold move for the nation of 1.2 billion. It contained high hopes from the start: a sustainable increase in jobs, greater foreign direct investment, and much more manufacturing. The government incorporated new incentives encouraging domestic and multinational enterprises to make their home in India—understanding that the initiative’s success would rest on the amount of love it received.
Modi then launched another pivotal campaign in 2015, focusing this time on India’s technological power and connectivity. Called Digital India, the initiative pushed for a new era of digital empowerment in which all citizens would be able to access government services online by 2018. The effort soon escalated internationally, as people began to see its global implications. Microsoft announced India would become its hub for cloud services, connected to data centers around the nation. Later that year, Qualcomm committed $150 million to the nation’s budding entrepreneurial scene.
Both Make in India and Digital India have revealed that achieving these ambitious realities in the long term will require more than just a shift in global perception. To create better partnerships and infrastructure, government processes also need to change.
Here, Modi has made a major commitment. At Make in India Week in February 2014, he publicly announced “a complete change of the government’s mind-set.” Looking to replace outdated policies with fresh ones, the government promised to become more of a business partner than the strict and traditional regulating body it had been.
Arguably, the benefits of this shift are already being reaped. In the past year, regional governing bodies have signed Make in India agreements with various companies, including Taiwanese electronics manufacturer Foxconn. Over the next five years, the company intends to invest $5 billion into building new factories and research-and-development centers in Maharashtra, one of India’s western states.
In May, the Maharashtra government also signed a Memorandum of Understanding (MoU) with Autodesk offering free Autodesk Fusion 360 for certain small- and medium-size manufacturing firms registered with the Department of Industries. Beyond offering access to the cloud-based CAD/CAM software tool, the partnership also ensured that firms would get proper training. This way, manufacturers could warm up to the system before attempting to integrate it.
Gaining that familiarity first is key because, around the world, cloud applications have received mixed responses due to potential security risks. But many of India’s small and medium manufacturers have chosen to embrace its strengths. They see, for example, that using the cloud allows people to easily work together across distances. Unique Tooling Solutions Pvt. Ltd., a medium-size business providing cutting and machining tools, maintains manufacturing and design centers in two cities. The firm is now using cloud-based software to bridge the literal distance, helping the teams become more synchronized, responsive, and up-to-date.
“They get the best out of the software as well as the machine process,” says V.S. Kulkarni, director of Unique Tooling Solutions. “The important thing is, we’re now not only manufacturers. We can give the complete machine solution under one roof.”
Then, there’s the good news every business likes to hear: low cost. “Fusion 360 has CAM facility, which has helped us get our machine cost accurate and, hence, a better success rate of tool finalization,” says Sanjay Mudholkar, director of Precision Tool Room and Moulding House, a component and mold-making manufacturer. The technology helps Precision design and simulate molds, visibly improving its productivity.
Kulkarni echoes similar experiences: Using cloud-based design software at Unique Tooling Solutions helps whittle down a time-intensive production process.
“With the introduction of [this technology], the whole process has resulted in the reduction of manpower, time required for operations, and time required for design,” he says, noting these saved minutes are crucial for small-scale organizations’ continued success.
Mudholkar has only praise for Make in India and the opportunities it has opened for the small-to-medium enterprise sector. The initiatives and partnerships guiding the movement, he says, are what gave his firm the digital capability to participate in it in the first place. But despite the clear support, he admits that most projects are still in their early stages and may take a while to deliver.
The explanation for that projected delay is simple: Cloud for India is still in its infancy. “With cloud-based software, Internet speed governs the design speed,” Mudholkar says.
In fact, the majority of the nation cannot use cloud technology, or prefers not to because of the need for strong Internet connectivity. Without a quick and stable network connection, crucial processes like data transfers will occur at very low speeds. But there is hope.
“With the advent of 4G in India, we hope that [cloud technology] will become more relevant,” Mudholkar says. Digital India is still hard at work to bring the much-desired online infrastructure, and on its agenda is high-speed Internet connectivity.
If and when all these elements come together, India’s manufacturing sector shows massive promise. The seamless collaboration enabled by cloud means more than just added efficiency. As firms increase the efficiency and accuracy of their processes, they produce higher-quality items in India—and as demand for these products explodes, the nation will become more globally competitive.
In many ways, the introduction of cloud technology in this movement has demonstrated that innovation in India takes root from below. When enabled, smaller enterprises are taking the necessary risks, led by individuals who would rather adopt new technologies than wait for such change to trickle down. For a country experiencing massive growth, this kind of innovation is key—and, thankfully, it’s just the beginning.