GS-3, Indian Economy, Uncategorized

Government approves capital goods sector policy

The Hindu

News

  • First -ever policy for the capital goods sector approved by the Cabinet .

Key points of the policy

  • It aims to triple the value of production of capital goods to Rs.7.5 lakh crore by 2025 and create more than 21 million jobs.
  • It envisages increasing exports to 40 per cent of production from the present 27 per cent.
  • The share of domestic production in India’s demand will also be increased from 60 per cent to 80 per cent, making India a net exporter of capital goods.
  • It will help in realising the vision of ‘Building India as the World class hub for Capital Goods’.
  • It will also play a pivotal role in overall manufacturing as the pillar of strength to the vision of ‘Make in India’.
  • The objectives of the policy will be met by the Department of Heavy Industry in a time-bound manner through obtaining approval for schemes as per the roadmap of policy interventions.

What are ‘Capital Goods’?

  • Capital goods consist of any tangible assets that an organization uses to produce goods or services such as office buildings, equipment and machinery.
  • Consumer goods are the end result of this production process.
  • A capital good is a durable good (one that does not quickly wear out) that is used in the production of goods or services.
  • Capital goods are one of the three types of producer inputs, the other two being land and labor, which are also known collectively as primary factors of production.

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