Dubai: India has witnessed a 53 per cent growth in the foreign direct investment last year triggered by manufacturing in automobile, power, pharmaceuticals, among others, and the government is determined to further simplify the process of doing business, a government official said on Monday.

The Indian government has undertaken major initiatives to simplify doing business, and that has triggered an upgrade in ranking in ease of doing business by the World Bank.

“We want to make manufacturing fashionable again in India. The manufacturing has to come back to focus,” Palka Sahni, Deputy Secretary in the Department of Industrial Policy & Promotion under the Ministry of Commerce and Industry from the Indian government told reporters at an industry conference. “We have set ourselves a target of 10 per cent for the next three decades.” Currently, India is seen as a favourable services destination, and the sector contributes to about 50 per cent of the GDP currently.

Improving processes, eliminating old outdated laws and usage of technology are the some of cornerstones that new government has undertaken after assuming office about two years ago, she said. The Indian government wants the country to be a part of the global supply chain, she said.

The government has been also focussing on developing the infrastructure across the country.

There is a proactive intervention from all state governments with each other competing to attract foreign flows, Sahni said. “We are now witnessing competitive federalism in terms of state governments competing for making land, power and infrastructure available,” she added.

The government has also launched a single window clearance system to attract capital.

In all more foreign capital would mean the country is an a better position to counter external shocks, ratings agency Moody’s said.

“We do not expect a significant renewed widening of India’s current account deficit (CAD). Our assumption that commodity prices will remain low in 2016 and 2017 supports this view, while FDI inflows are likely to climb in response to government measures,” the ratings agency said.

“We expect FDI inflows to continue to rise. It provides a stable source of financing that will help to mitigate India’s external financing risks.” Higher inflows suggest that government policies, such as efforts to liberalise foreign investment limits in several sectors and the ‘Make in India’ campaign, are bearing fruit, the ratings agency said.