Govt looking into rare earth shortage, says PM; calls for ‘swadeshi’

The Prime Minister was speaking in Gujarat’s Hansalpur where he green-flagged Maruti Suzuki’s first battery electric vehicle, eVitara, which will be manufactured here and exported to over 100 countries.

During his speech, the Prime Minister also expanded on his vision of “swadeshi”, saying that investment could be from any country, but the labour involved should be Indian.

With top officials of Maruti and Suzuki, Japanese ambassador Keiicho Ono and Gujarat Chief Minister Bhupendra Patel among the audience, Modi said, “The things made by Japan here are all swadeshi. My definition of swadeshi is very simple… Whether it is dollar or pound, whether the currency is black or white, I am not concerned about it. But in the production, the sweat must be of my fellow countrymen… The production will have the smell of my country’s earth, of my mother India.”

At the event, the Prime Minister also announced that under a new initiative, three Japanese companies (Toshiba, Denso and Suzuki) will jointly manufacture battery cells in India for the first time to be used in hybrid vehicles.

Modi said he would visit Japan next week and added that the relationship between the two countries is beyond “diplomatic relations” and that of “culture and trust”.

The Prime Minister’s comments on the rare earth materials shortage come as automakers are feeling the heat of Chinese curbs on the crucial minerals. The Indian Express reported Tuesday that auto and bike makers are cutting down on certain non-essential equipment to reduce the usage of rare earth materials as uncertainty over China’s green light to export the key materials looms.

Modi said that despite ongoing supply chain disruptions, policies made by the Government over the past decade have proved useful. “In 2014, we started working on it, our goal of Make in India and how we can create a conducive environment for global and domestic investors,” he said.

Modi said industrial corridors are being developed to support this vision as well as plug-and-play infrastructure and logistics parks are being established across the country. The Prime Minister further noted that manufacturers in several sectors are being provided benefits under the Production-Linked Incentive scheme.

Stressing that through major reforms, longstanding challenges faced by investors have been resolved, Modi said these reforms have made it easier for investors to invest in Indian manufacturing.

He said that in this decade, electronics production in India has increased by nearly 500 per cent, mobile phone production by up to 2,700 per cent compared to 2014, and defence production by over 200 per cent in the past decade.

The land for Maruti Suzuki’s plant was allotted to the company in 2012, when Modi was Chief Minister. “Our efforts from that time are playing a big role in fulfilling the nation’s dreams… Suzuki, a Japanese company, is making its cars in India and exporting them to Japan… India has the power of democracy, the advantage of demography and a big pool of skilled workforce, which makes global companies trust India,” Modi said.

Noting that for four consecutive years, Maruti Suzuki has been India’s largest car exporter, the Prime Minister said that soon EV exports will also begin on the same scale, and soon such cars running across the world will bear the ‘made in India’ label. Companies like Maruti Suzuki have effectively become brand ambassadors of Make in India, he said.

The Prime Minister also urged states to step up their reform process and increase ease of doing business to attract investors. “I want states to be proactive, pro development policies and reforms… The faster a state makes its policies neat and clean, with no ifs and buts, it will help investors’ confidence… I call on states to compete on reforms and good governance,” he said.

(Soumyarendra Barik was in Gujarat at the invitation of Maruti Suzuki)