Opportunities in the Indian manufacturing sector | So Good News
India is on track to become a global manufacturing hub and has the potential to export goods worth USD 1 trillion by 2030. The manufacturing sector occupies a prominent position in the Indian economy, accounting for 17% of the country’s GDP and employing about 27.3 million people. People. The Indian government aims to increase the share of manufacturing in the overall economy by 25% by 2025 by introducing various schemes and policies. India’s low product quality; It is now well-positioned to take advantage of China’s declining competitiveness due to trade conflicts and border disputes. The ban on imports of Chinese products has created huge opportunities for Indian manufacturers. India’s manufacturing sector could add more than $500 billion annually to the global economy by 2030. India ranks 63rd in ease of doing business in 2020; 142 in 2014 and a significant improvement.
ADVANTAGES OF DEVELOPMENT OF MANUFACTURING INDUSTRY IN INDIA
Favorable government initiatives and policies
To encourage manufacturing activities, the Government of India launched Make in India; grants and bank loans; Government of India has announced several policies such as import of few goods. India has announced PLI programs worth USD 26 billion. Manufacturing sector 13. As per Union Budget 2022-2023, an additional loan of INR 2 lakhs for MSMEs has been facilitated under CGTMSE.
Low labor costs and availability of skilled workers
India is an alternative to China because of its low labor costs. India has an abundance of skilled and unskilled workers. India has millions of engineers, and the WSJ reported in 2015 that about 12 million people enter India’s workforce every year. Availability of English-speaking youth is an added advantage for Indian manufacturers.
India is poised to become the world’s third largest consumer market, with India’s consumer spending expected to reach $6 trillion by 2030, according to the World Economic Forum. “India’s top 40 cities will contribute $1.5 trillion combined, and by 2030, online retail will have the opportunity to unlock more than $1.2 trillion in spending in rural India,” notes the World Economic Forum. With a population of 1.4 billion, India has created a huge market for manufacturing industries.
Opportunities in the food processing industry
The demand for processed foods has dramatically increased the number of workers; lifestyle changes; increase in disposable income; young population; Because of urban and nuclear families. India is milk, mango banana, Being the largest producer of guava etc., Indian food manufacturing industries will benefit mainly from the availability of raw materials. As India produces more than 300 million tonnes of various food grains, it has opened up many opportunities for food manufacturers to develop a variety of products. Due to the increase in working women, there is a huge demand for ready-to-eat/cook products. PMKSY programme; PMFME programme; Government policies and initiatives such as the PLISFPI program and the creation of large-scale food parks are accelerating the growth of the food processing sector in India.
Opportunities in the chemical industry
India is the sixth largest chemical producer in the world, covering more than 80,000 commercial products. The Indian chemical industry was valued at USD 180 billion in 2019 and is expected to reach USD 305 billion by 2025. Investment is estimated at USD 107.4 billion (INR 8 lakh crore) in the chemical and petrochemical industry in India by 2025. Launched India’s PLI program to boost chemical manufacturing and exports by developing Bulk Drug Parks with a budget of INR 1,629 crore. 100% FDI is allowed under the automatic channel in the chemical sector and FDI reached USD 19 billion between April 2000 and December 2021. Supply chain disruptions and trade conflicts between the US and Europe have created many opportunities in the chemical sector. According to the PCPIR policy, exclusive integrated manufacturing hubs are expected to attract more than USD 276 billion in investment by 2035.
Opportunities in the field of defense
Due to territorial disputes and rising national security concerns, the demand for defense equipment is increasing rapidly. Between 2020 and 2030, the Indian defense market represents $307 billion in capital and revenue opportunities as it provides Made in India defense products and services to 75 countries. The Indian government has issued a list of traditional medicines to ban import of defense products to promote local manufacturers. The Defense Manufacturing and Export Promotion Policy 2020 promotes self-reliance in the defense manufacturing industry with a turnover of INR 1 lakh 75,000 (USD 25 billion) including exports of INR 35,000 (USD 5 billion). Space and defense goods and services by 2025.
Opportunities in Electronics Industry
According to the Ministry of Electronics and Information Technology, the electronics manufacturing industry is worth US$75 billion in 2021 and is expected to reach US$300 billion by 2026. The consumer electronics sector dominates the electronics market with over 35% share. It has more than 15 percent market share in various industrial electronics and computer segments. Government of India Electronic Product Manufacturing Cluster (EMC 2.0); Modified Electronics Manufacturing Cluster (EMC 2.0), such as Electronic Components Manufacturing and Semiconductors (SPECS); 100% FDI is allowed under the automatic route to attract investments in the electronics sector. smart production; robot A.I. Digital technology transitions like IOT etc. have led to the growth of the electronics industry. India also announced a 5.5 billion PLI program to support large-scale electronics manufacturing. In addition, the Government of India is promoting the development of electronics manufacturing clusters to provide world-class infrastructure to make India an electronics manufacturing hub by supporting greenfield and brownfield projects.
India is considered the third most preferred manufacturing destination in the world. creation of manufacturing conglomerates; Allowing up to 100% FDI under automatic route; Easy access to bank loans is accelerating the growth of India’s manufacturing sector. Indian manufacturers need to focus on developing innovative products and tap export opportunities to grow at an expanding rate. China exports more than $2.5 trillion worth of goods annually, including $490 billion to the United States. The conflict between the US and China has created a huge market for Indian manufacturers.
(The author is Mr. Guruprasad Bangle, Co-founder & Chief Technology Officer, SolutionBuggy and the views expressed in this article are his own)