CHENNAI: Indian firms have been invited to play a key role in the development of human capital under Malaysia’s New Economic Model (NEM).
Prime Minister Datuk Seri Najib Tun Razak told India’s captains of industry at a roundtable meeting here on Friday that the NEM, to be launched within the first quarter of the year, would be based on innovation, creativity and high sources of growth.
He said the new model was aimed at shifting Malaysia’s reliance on manufacturing based on low and semi-skilled workers to one focused on high technology and a modern service sector with skilled and highly-paid workers.
“We need to move Malaysia from an upper middle-income economy to a high-income economy by 2020.
“For this to happen, we will increase investments in human capital development and build a strong foundation in research and development design and engineering, and commercialisation of research activities,” Najib said.
He added that the Government was rationalising all research funds and grants to be more effective.
“Indian companies focusing on research and development, and design and development, are welcome to explore and take advantage of the opportunities in these areas,” he said.
Najib added that Malaysia had always provided a cost-competitive environment for Indian investors.
He said the Government remained business-friendly, and had put in place the necessary infrastructure and administrative support to provide a conducive environment for both local and foreign investors.
“We continually review existing incentives and create new ones to attract private investments.
“The NEM focuses on enhancing private investment from domestic sources, and these companies are encouraged to collaborate with foreign investors strong in high-knowledge content industries,” he said.
Among the areas identified for further development were advanced electronics, information communication and technology (ICT), machinery and equipment, biotechnology, medical devices and renewable energy.
Najib said attractive incentives like pioneer status and investment tax allowances would be offered to companies investing in these areas.
He said India, the world’s leading provider of information technology services particularly in software and multimedia development, should explore opportunities for joint ventures or other forms of collaboration.
On ICT, he said, the Malaysian Government had put in place a number of initiatives to promote the sector, including granting Multimedia Super Corridor-status to qualified companies.
MSC-status firms enjoy incentives and benefits backed by the Bill of Guarantees.
Malaysia is now home to 1,953 MSC-status companies, out of which 401 or 20.5% were foreign-owned. Indian firms make up 13.7%.
Earlier, Najib witnessed the signing and exchanges of memorandums of understanding between 13 Malaysian and Indian companies.