India At 75: AM Naik Sees A Future Rife With Challenge, Rich In Opportunity

India at 75 is abuzz with ‘Aatmanirbhar Bharat’, and this has set a challenging target for Indian industry. The next phase is going to be critical because future generations will judge us not by our intentions but by the outcomes of our actions. Along with self-reliance, it makes eminent sense, therefore, to integrate sustainability and ‘future-readiness’ into our business plans. Powered by the engine of ‘aatmanirbharta’, we see multiple opportunities for growth before us, and we will focus on the ones Larsen & Toubro is most familiar with.

Powering A Greener Future

As India’s energy demand keeps growing exponentially, the solution to meet that demand ought to pivot on renewables. The government of India has already set attainable targets to increase non-fossil energy capacity to 500 gigawatts by 2030, including 5 million tonnes of green hydrogen. Demand for energy storage mechanisms is also expected to reach 540 GWh by 2030, enabling a round-the-clock availability of renewable power.

India is well-positioned to achieve manufacturing leadership in green energy. We have what it takes – engineering competence, skillsets, land, competitive power, policy incentives, and a robust supply chain. We could well emerge as a global hub for electrolysers, fuel cells, solar photovoltaic units, and energy storage systems. There are currently very few original equipment manufacturers globally and even fewer in India.

The government, through its production-linked incentive scheme, is promoting the domestic manufacture of most of these items at globally competitive rates. We understand that electrolysers too will soon enjoy coverage under the PLI scheme.

Historically, a few companies have been at the forefront in meeting the nation’s needs. At L&T, we are taking this tradition forward by setting up giga-factories for electrolysers, advanced chemistry cells for stationary applications and to build-own-and-operate green hydrogen and ammonia assets. L&T’s efforts have recently been recognised by the New York-based Engineering News-Record. The company was placed third in the prestigious ENR Ranking of the ‘World’s Top 200 Environmental Firms’ of 2022 and is the only Indian company to do so.

Self-Reliance In Defence

In defence, self-reliance is not merely an economic alternative but a matter of national security. Recognising this, the government introduced a clutch of reforms. It has enhanced acquisition from Indian OEMs, increased budget allocation and opened the doors to exports. It has also granted 25% of defence research and development allocation to industry, start-ups and academia. With measures like the Defence Acquisition Procedure 2020, the Ministry of Defence has been progressively opening up procurement from the domestic private sector through ‘Make’ programmes.

Policy reforms need to be complemented with strategic partnership programmes to stimulate the indigenous development of complex platforms and build intellectual property for domestic markets and exports. More importantly, the government should enable value-based acquisition (quality-cum-cost based selection) for providing the private sector with a much-needed level playing field.

Tomorrow’s wars are going to be fought very differently. So defence, space, and cyber would need to integrate with artificial intelligence, remotely controlled operations, cybersecurity and edge computing technologies to assist near real-time decision making. Here, India’s prominence in global IT/ITeS will provide us with the edge in building strong and futuristic capabilities.

Many companies have gained from the experience of working with the Defence Research and Development Organisation. L&T began in the mid-1980s and has over the years, developed exceptional capabilities in the design, engineering and construction of defence equipment and platforms. We have also nurtured best-of-class manufacturing and system integration and R&D campuses across the country. Industry is therefore ready, willing, and able to demonstrate the many advantages of self-reliance in defence.

Space Voyage – Far Horizons

ISRO has done India proud! Our space journey has been ‘Atmanirbhar’ decades before even the term was coined. It has achieved global benchmarks - high launch success rate, low launch cost, flexibility in adopting different orbits, and impressive innovation. This is heartening news but a reality check: India’s share of global space commerce stood at only 2% in 2019, viz., about $7 billion.

Our Prime Minister has sensed the potential and promise of space commerce and opened the doors of the sector to private companies.

Looking back, I am happy to say that L&T has evolved as an industry partner to ISRO in the development of infrastructure, testing facilities and ancillary work. Recently, ISRO has prioritised advancement in the field of launch facilities, where again L&T is an active contributor. Going forward, I am sure that Indian industry will continue to support ISRO as well as NewSpace India in their missions to the far horizons.

Supporting Public Infrastructure

We will focus on the water, sanitation and housing sectors of public infrastructure. Through flagship schemes like Jal Jeevan Mission, Amrut 2.0, Swachh Bharat Mission 2.0, Namami Gange, Pradhan Mantri Krishi Sinchayee Yojana and Pradhan Mantri Awas Yojana, the government is revolutionising water and sanitation services for millions.

To encourage private investments, the government has undertaken reforms in land acquisition, statutory clearances, arbitrations and dispute settlements. The pace of development is being well-monitored through unified portals like ‘Gati Shakti’. Clearly, this is the way to go.

Speed does not necessarily compromise quality or EHS. For instance, L&T has demonstrated that even at a rapid pace, it is possible to maintain the highest standards of quality, health and safety, while adhering to sustainability practices. We recently constructed 96 flats in just 96 days as part of a building project under the PMAY and a 7-storey building for DRDO in under 45 days. This was possible through advanced technologies like pre-fabricated pre-finished volumetric construction, and Industry 4.0 practices such as digital twin, building information modelling, etc. Such technologies will hopefully soon become the norm – instead of being isolated examples. This is the key to achieving affordable housing for all.

Reaping The ‘Demographic Dividend’

To create an Industry 4.0-ready workforce, an active partnership for upskilling is vital among the government, India Inc. and academia. This exercise, which needs to be both affordable and incentive-driven, is doable since India, with a median age of 28.4, has a young, aspirational workforce which is becoming increasingly tech-savvy, thanks to the telecom revolution. This is a ‘demographic dividend’ waiting to be reaped. Equipping technocentric skillsets to our youth will also open up myriad entrepreneurship opportunities.

Conclusion

‘Aatmanirbhar Bharat’ is more than a catchphrase of capability, it is an affirmation of confidence. We are confident of a vibrant future for the country if we muster the collective will because we believe change is a shared responsibility. Democracy is participative in nature and asks for an active role from all its stakeholders. We now stand 25 years away from celebrating 100 years of Independence. As we celebrate Azaadi ka Amrit Mahotsav, let us resolve to give our next generation the greatest gift of all - a centenary of which they will all be proud.

AM Naik is Group Chairman, Larsen & Toubro.

The views expressed here are those of the author’s and do not necessarily represent the views of BQ Prime or its editorial team.