indian manufacturing sector
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GDP-Manufacturing sector
Presented bySonam Gangwani
& Pallavi Sen
Submitted to: RVM Finishing School & Consultancy. www.rvmfinishingschool.com 9550812082
AGENDA• History of GDP• GDP growth %• Manufacturing sector• Current Scenario• State & Sector wise contribution to GDP• Manufacturing & Employment Relation• Government Initiatives• Challenges faced by manufacturing sector• Future outlook
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HISTORY
GDP was first developed by SIMON KUZNETS.Basically after Breton Woods Conference, held inNew Hampshire in 1944,GDP became the main tool for measuring a countries economy.
GDP
2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
9.48% 9.57% 9.32%
6.72%
8.00%8.60%
6.88%
GROWTH % OVER PAST 8 YRS
GROWTH % OVER PAST YRS
Source: www.mospi.nic.inSubmitted to: RVM Finishing School & Consultancy. www.rvmfinishingschool.com
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Different Sectors
Agriculture sector
Manufacturing sector
Service sector
Manufacturing
Basic goodsCapital goods
Intermediate goods
Consumer goods
ElectricityCoal
FertilizersCement
Steel casting
Commercial vehiclesElectric motorsWagonsHeavy
locomotives
Giant tyresPetroleum
BoltsPaintsJute
Plywood
PaperSugarWheatSoap
PhoneTea
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MANUFACTURING SECTOR
Backbone of any economyFuels growth & employment
generationCatalyst for agricultural & service
sectorBarometer of overall health of
economy
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Top sectors in Indian manufacturing
AUTO INDUSTRY CHEMICALS ELECTRONICS ENGINEERING FOOD PROCESSING GEMS AND JEWELLERS LEATHER MACHINE TOOLS TEXTILES WATER MINING
41%
25%
17%
14%
2% 1%
contribution %
EngineeringGems & JewelleryChemicalsTextile & productsLeather & productsHandicrafts
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Current scenario
Spectacular growth after slowdown in 90’sMore diversification & better availability of
skilled man powerSignificant player in aerospace industry
undergoing transformationGenerates about 45 million jobs, 80% of which
are unorganized segmentPotential to create up to 90 million jobs by 2025
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STATE-WISE CONTRIBUTION
Strong manufacturing states Gujarat, Maharashtra, Tamil Nadu, Karnataka, Andhra Pradesh, Goa, Haryana, Jharkhand
Medium manufacturing states Chattisgarh, Himachal Pradesh, Madhya Pradesh, Odisha, Punjab, Rajasthan, Uttar Pradesh, Uttarkhand
Weaker manufacturing states Tripura, Sikkim, Nagaland, Kerela, Bihar,Assam Jammu & Kashmir, West Bengal
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SECTOR WISE CONTRIBUTION TOWARDS GDP
2006-07 2007-08 2008-09 2009-10 2010-11 2011-120%
10%
20%
30%
40%
50%
60%
70%
20% 19% 18% 17% 17% 16%
26% 25% 26% 26% 26% 25%
54% 56% 56% 57% 58% 59%
AGRICULTURE MANUFACTURING SERVICE
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Manufacturing & Employment Relation
china germany japan russia brazil thailand usa india uk
28%
22%19% 18% 17%
15%13% 12% 11%
Employment contribution
%
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Government Initiative
National manufacturing competitiveness council (NMCC)
Set up in September 2004Inter disciplinary & autonomous body at
highest levelSustain growth of manufacturing industriesSuggest ways & means for enhancing sub
sectors having potential of global competitiveness
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CLASSIFICATION IN MANUFACTURING SECTOR(12TH PLAN)
SECTOR OF STRATEGIC
IMPORTANCE
SECTOR OF BASIC INPUT
SECTOR OF DEPTH AND VALUE ADDITION
SECTOR FOR EMPLOYMENT
DEFENCE EQUIPMENTAEROSPACE
SHIP BUILDING & REPAIRCAPITAL GOODS
STEELMINERAL EXPLORATION
FERTILIZERCEMENT
AUTOMOBILEELECTRONICS
PHARMACHEMICAL
PAPER
TEXTILEFOOD PROCESSING
LEATHER & LEATHER GOODSGEMS & JEWELLERY
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CHALLANGES
Manufacturing sector requires urgent attention both at macro and micro levels
Tax burden on MSME Enhancing the skills of the workers Up gradation of technology High cost of production Quality of products Manufacturers operating beyond their capacity Expensive financing Low labor productivity Poor infrastructure Raw material cost
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Expectations
Increase in rate of job creationFocus on level of domestic value additionEnhance the global competitiveness through
appropriate policy supportEnsure sustainability of growthIncrease in manufacturing sector growth to 2-
4% more than GDP growth for the economy and increase share to 25% of overall GDP by 2025
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Growth expectations for 2012-13 compared with 2011-12
SECTOR GROWTH EXPECTATION
CHEMICALS LOW
FOOD PRODUCTS MODERATE
ELECTRONICS & ELECTRICALS LOW
TEXTILES MODERATE
CAPITAL GOODS LOW
STEEL & METALS LOW
AUTOMOTIVE LOW
CEMENT STRONG
LEATHER & FOOTWEAR MODERATE
TYRE LOW
MACHINE TOOLS LOW
TEXTILES MACHINERY MODERATE
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Potential
Only manufacturing sector has the capacity to absorb large labor pool of the country(CISCO)
Manufacturing sector has great potential to employ people and increase the income levels(FICCI)
India placed 2nd in the Deloitte Manufacturing Competitive Report
India has beaten Brazil in the production of motor vehicles which is good sign for countries growth in value added manufacturing
Sources
www.ibef.orgwww.reuters.com
www.wikipedia.comwww.google.com
www.investopedia.comwww.investorzclub.comwww.machinemag.com
www.articles.economictimes.indiatimes.comSubmitted to: RVM Finishing School & Consultancy.
www.rvmfinishingschool.com 9550812082
Submitted to: RVM Finishing School & Consultancy. www.rvmfinishingschool.com 9550812082
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