The Union Cabinet on Wednesday approved the National Capital Goods Policy, 2016, which aims to create 21 million new jobs in the country by 2025. The decision was among a series of others made by the Cabinet on Wednesday, including ideas on promoting the government’s flagship Make in India scheme and approvals for major Railways projects and new Indian Institutes of Technology, The Indian Express reported.
Capital goods are those used to build other goods, rather than those that are bought directly by consumers. The policy envisions that by 2025, the capital goods industry in India will produce outputs worth Rs 7.5 lakh crore as against Rs 2.3 lakh crore in 2014-15. The sector is considered highly competitive in global markets, and thus holds massive potential for an emerging economy like India’s.
The policy also seeks to improve the domestic production of capital goods from the current 27-40% to at least 60-80%. The official document on the policy says the move could make India a “global manufacturing powerhouse”. Importantly, it mentions that a uniform Goods and Services Tax is crucial to making the capital goods policy a reality. The current government has been struggling to get the opposing parties on board with their plan to pass the GST Bill.
Among the other projects that got approved on Wednesday included a new railway line for thermal power plants in the Bina-Katni corridor of the West-Central Railways. The Cabinet also gave its go-ahead for incorporating six new IITs at Tirupati, Palakkad, Dharwar, Bhilai, Goa and Jammu and Kashmir.
The Cabinet meeting was chaired by Prime Minister Narendra Modi.
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