The Mahindra Group, with interests across IT, automotive, finance and defence, struck up a series of high- profile deals with international aerospace players at the Air Show in Paris
The chairman and managing director of the 416.9-billion Mahindra Group believes that it is the diversified business houses like his that need to take the lead and work with the Narendra Modi-led government to achieve the right kind of policy framework for such a cross-sector collaboration.
"Make in India will not work if we take a conventional linear approach. It has to be a leapfrogging into the future and India is ideally placed to do this," the 60-year-old businessman told PTI in an interview on the sidelines of the Paris Air Show, which concluded in the French capital on Sunday.
"It requires a different holistic approach and a recognition that it's not simply a question of stepping into China's shoes. Our 'Make in India' has to be different from China's in the sense that we have to do a 'taal-mel' or 'jugalbandi' of our IT skills that exist and our evolving manufacturing skills and become intelligent manufacturers."
"It is up to us to create a 'jugalbandi' within our own group and create a template which becomes almost like a construct for Make in India's success in future," he said.
In reference to the Modi government, Mahindra said, "There is a huge amount of support for this and that goes from the prime minister downwards. He is remarkably sensitive to these kind of arguments despite his background not being that of an economist -– maybe because his background is not of an economist that he is able to make these leaps of faith."
"Is the policy framework perfect? No, I think that's where we have to work with them. This is a whole new area and we have to come up with ideas as to how the landscape of regulation and incentives can change in order to create this kind of 'jugalbandi'."
The Mahindra Group, with interests across IT, automotive, finance and defence, struck up a series of high- profile deals with international aerospace players at the Air Show in Paris.
Besides a multi-million-dollar aero-components manufacture and supply contract from European aerospace consortium Airbus, the company also clinched pacts with GE and Magellan Aerospace earlier this week.
"It's pretty ironic that Airbus in particular has a much greater potential to buy out of India, which is a huge unexploited upside opportunity for Make in India. It is not a company whose future is in any fragile condition. It is a company that in fact is scrambling at the moment to enhance its supply chain and raise its sources of procurement from around the world," Mahindra said.
“So if Airbus in a sense raises its procurement from India, it will be a huge validation and vote of confidence in Make in India. If Airbus doesn't raise its level of procurement, then in a sense one could question whether India really has what it takes to be the successor to what China was in the last few decades," said the tycoon who has been at the helm of the Mahindra Group since 2012.
"We as a group, including Tech Mahindra and Mahindra Aerospace, are the largest suppliers of Airbus today out of India of parts and services combined. But the amount Airbus buys out of India is sub-$100 million, which to my mind is a very paltry sum. It buys over $400 million today from China and therefore I think there is an immediate opportunity to substantially hike what Airbus buys from India," he added.
The Harvard graduate, who was included in the Fortune magazine's list of the 'World's 50 Greatest Leaders' last year, has also served on the World Bank Advisory Board for Doing Business and expressed optimism on India's chances of climbing up the "Ease of Doing Business" rankings.
"From that vantage point, there is great optimism even in the World Bank that India can make an ascent in that list very quickly provided it focusses on the right things. I am quite optimistic that if they continue a targeted approach, there's no question that we should move up on that list.