India's Manufacturing Challenge: Why Jamshyd Godrej Says Demand is Key

Addressing mediapersons on the sidelines of the 21st CII Manufacturing Summit 2025, Godrej said that private investment is still slow, but the key issue is not the willingness of companies to spend.

"Whether it's private or public investment, it is really driven by demand," he said. He explained that investors act when they see people buying more goods. "If the demand is there, everyone will invest," he said, adding that the focus should be on creating demand rather than worrying about investment numbers.

Godrej pointed out that reforms like the Goods and Services Tax helped improve the business climate, but more effort is needed in other areas that affect day-to-day operations for companies. He said several rules still make work difficult, especially for smaller units. "There are many other areas for ease of doing business that need to be done," he said.

Speaking about labour codes and their effect on micro, small and medium enterprises (MSMEs), he said the sector faces too many rules and too much paperwork. "The MSME sector in India has been overburdened with regulation and the more that you can do to ease their regulatory burden, the better it is," he said. He noted that any reform that brings down the cost or complexity of running a business helps the sector grow.

Earlier, while addressing the gathering at the summit, Godrej said that India's manufacturing journey had long been overshadowed by its neighbours in Southeast Asia. "Countries like China and others in the region have become manufacturers to the world," he said.

"This is something that we have to aspire to; we have to aspire to be a manufacturer to the world." Godrej noted that while India has made progress, there remains "an enormous amount remaining to be done."

He recalled how in earlier summits, multinational companies were skeptical about India's potential to become a manufacturing powerhouse. "Their resounding answer was no," he said. "That spurred us to make sure that we have policies and a welcoming atmosphere for promoting manufacturing."

- ANI