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ManufacturingSectorinIndia
Latestupdate:November,2016
Electronicsexportshaveoutpaced
MANUFACTURING totalproduction
CumulativeFDIinflowsintothe
electronicssector,includingcomputer
EXPLOREOTHERINDUSTRIES
hardwareandsoftware,increasedata
CAGRof13.56percent,withthevalue
Manufacturing
increasingfromUS$9.8billioninFY10
toUS$21.02billioninFY16
Thecapitalgoodsindustry Demandgrowth,supplyadvantages,
andpolicysupporthavebeen
employs1.4millionof
instrumentalinattractingFDI
peopleandisestimatedto
employ2.8millionby2017.
Industry
BROWSE:
AGRICULTURE(HTTP://WWW.IBEF.ORG/INDUSTRY/AGRICULTUREINDIA.ASPX)
AUTOMOBILES(HTTP://WWW.IBEF.ORG/INDUSTRY/INDIAAUTOMOBILES.ASPX)
AUTOCOMPONENTS(HTTP://WWW.IBEF.ORG/INDUSTRY/AUTOCOMPONENTSINDIA.ASPX)
AVIATION(HTTP://WWW.IBEF.ORG/INDUSTRY/INDIANAVIATION.ASPX)
BANKING(HTTP://WWW.IBEF.ORG/INDUSTRY/BANKINGINDIA.ASPX)
BIOTECHNOLOGY(HTTP://WWW.IBEF.ORG/INDUSTRY/BIOTECHNOLOGYINDIA.ASPX)
CEMENT(HTTP://WWW.IBEF.ORG/INDUSTRY/CEMENTINDIA.ASPX)
CONSUMERMARKETS(HTTP://WWW.IBEF.ORG/INDUSTRY/INDIANCONSUMERMARKET.ASPX)
EDUCATIONANDTRAINING(HTTP://WWW.IBEF.ORG/INDUSTRY/EDUCATIONSECTORINDIA.ASPX)
ENGINEERING(HTTP://WWW.IBEF.ORG/INDUSTRY/ENGINEERINGINDIA.ASPX)
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FOODINDUSTRY(HTTP://WWW.IBEF.ORG/INDUSTRY/INDIANFOODINDUSTRY.ASPX)
GEMSANDJEWELLERY(HTTP://WWW.IBEF.ORG/INDUSTRY/GEMSJEWELLERYINDIA.ASPX)
HEALTHCARE(HTTP://WWW.IBEF.ORG/INDUSTRY/HEALTHCAREINDIA.ASPX)
INFRASTRUCTURE(HTTP://WWW.IBEF.ORG/INDUSTRY/INFRASTRUCTURESECTORINDIA.ASPX)
INSURANCE(HTTP://WWW.IBEF.ORG/INDUSTRY/INSURANCESECTORINDIA.ASPX)
IT&ITES(HTTP://WWW.IBEF.ORG/INDUSTRY/INFORMATIONTECHNOLOGYINDIA.ASPX)
MANUFACTURING(HTTP://WWW.IBEF.ORG/INDUSTRY/MANUFACTURINGSECTORINDIA.ASPX)
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OILANDGAS(HTTP://WWW.IBEF.ORG/INDUSTRY/OILGASINDIA.ASPX)
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RETAIL(HTTP://WWW.IBEF.ORG/INDUSTRY/RETAILINDIA.ASPX)
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RELATED NEWS
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LastUpdated:December15,2016
CiplatosetupmanufacturingfacilityforpharmaceuticalsinIran
(http://www.ibef.org/news/ciplatosetupmanufacturingfacilityforpharmaceuticalsiniran)
PanasonictostartmanufacturingrefrigeratorsinIndia
(http://www.ibef.org/news/panasonictostartmanufacturingrefrigeratorsinindia)
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(http://www.ibef.org/news/panasonicstepsupindiafocus)
China'sbiggestcarmakertodriveintoIndia
(http://www.ibef.org/news/chinasbiggestcarmakertodriveintoindia)
GovernmentremovesexcisedutyonPoSmachinemanufacturingtoeasecashflow
(http://www.ibef.org/news/governmentremovesexcisedutyonposmachinemanufacturingtoeasecashflow)
GETNEWSALERTS
GEisinterestedincommercial
andmilitaryaviation,
renewables,oil,gasandsees
bigopportunityinmakingin
India.
JefferyImmelt
Chairman,GeneralElectric
(http://dashboardcommerce.gov.in/)
SNAPSHOT (HTTP://WWW.IBEF.ORG/INDUSTRY/MANUFACTURING-SECTOR-IN-
INDIA)
SHOWCASE (HTTP://WWW.IBEF.ORG/INDUSTRY/MANUFACTURING-SECTOR-
INDIA/SHOWCASE)
PRESENTATION (HTTP://WWW.IBEF.ORG/INDUSTRY/CHEMICALS-PRESENTATION)
LastUpdated:December,2016
CHEMICALSSECTORREPORT(HTTP://WWW.IBEF.ORG/DOWNLOAD/CHEMICALSDECEMBER20161.PDF)|DECEMBER,
2016
http://www.ibef.org/industry/manufacturingsectorindia.aspx 2/6
12/15/2016 ManufacturingSectorinIndia,ManufacturingIndustry,IndianIndustries
ELECTRONICSSECTORREPORT(HTTP://WWW.IBEF.ORG/DOWNLOAD/ELECTRONICSDECEMBER2016.PDF)|
DECEMBER,2016
Introduction
ManufacturinghasemergedasoneofthehighgrowthsectorsinIndia.PrimeMinisterofIndia,MrNarendraModi,
hadlaunchedtheMakeinIndiaprogramtoplaceIndiaontheworldmapasamanufacturinghubandgiveglobal
recognitiontotheIndianeconomy.
Indiasrankingamongtheworlds10largestmanufacturingcountrieshasimprovedbythreeplacestosixthposition
in2015#.
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TheGovernmentofIndiahassetanambitioustargetofincreasingthecontributionofmanufacturingoutputto25per
centofGrossDomesticProduct(GDP)by2025,from16percentcurrently.
MarketSize
IndiasmanufacturingsectorhasthepotentialtotouchUS$1trillionby2025.Thereispotentialforthesectorto
accountfor2530percentofthecountrysGDPandcreateupto90milliondomesticjobsby2025.Business
conditionsintheIndianmanufacturingsectorcontinuetoremainpositive.
Investments
Inamajorboosttothe'MakeinIndia'initiative,theMakeinIndiaweekwhichwasheldinMumbaibetweenFebruary
13and18,2016,receivedanoverwhelmingresponsefrominvestors.ThefairhadclosedwithINR15.2trillion(US$
(http://dashboardcommerce.gov.in/)
225.32billion)ininvestmentcommitments.
WiththehelpofMakeinIndiadrive,Indiaisonthepathofbecomingthehubforhitechmanufacturingasglobal
giantssuchasGE,Siemens,HTC,Toshiba,andBoeinghaveeithersetuporareinprocessofsettingup
manufacturingplantsinIndia,attractedbyIndia'smarketofmorethanabillionconsumersandincreasingpurchasing
power.
InSeptember2016,ForeignDirectInvestment(FDI)inelectronicmanufacturinghasreachedanalltimehighofRs
123,000crore(US$18.36billion)in2016,fromRs11,000crore(US$1.65billion)in2014onthebackofenabling
policiesofthegovernmentanditsMakeinIndiainitiative.
Indiahasbecomeoneofthemostattractivedestinationsforinvestmentsinthemanufacturingsector.Someofthe
majorinvestmentsanddevelopmentsinthissectorintherecentpastare:
Huawei,theChinabasedsmartphonemanufacturer,hasenteredintoanagreementwithsolutionsprovider
FlextronicsTechnologies(India)PrivateLimited,tomanufactureitssmartphonesinIndia.Flextronicswouldstart
bymaking3millionsmartphonesatitsfacilityinChennaiandisexpectedtogenerateadditional1,500jobs.
TristoneFlowtechGroup,theGermanybasedflowtechnologysystemsspecialist,hassetupanewfacilityin
Pune,whichwillmanufacturesurgetankaswellasenginecoolingandairchargehosefortheIndianmarket.The
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companyplanstostarttheproductionattheplantinthefourthquarterof2017.
TataPowerhaspartneredwithUSbasedJavelinJointVenture,whichisapartnershipbetweenRaytheon
CompanyandLockheedMartin,foritsStrategicEngineeringDivision(SED),inordertocreateastrategytoco
developandproducetheJavelinmissilesystemandintegrateplatformmountstomeetIndianrequirements.
LeEco,aChinesetechnologycompany,hasenteredintoapartnershipwithCompalTechnologiesandinvested
US$7milliontosetupmanufacturingfacilityatGreaterNoidainordertostartmanufacturingLe2smartphonesin
India.
ZopoMobile,aChinabasedsmartphonemanufacturer,planstoinvestRs100crore(US$15million)tosetupa
manufacturingplantinNoidabytheendof2016,whichwillhaveamonthlyproductioncapacityof100,000units.
HondaMotorcycle&ScooterIndiaplanstoinvestaroundRs600crore(US$88.94million)toaddanewlineatits
NarsapurafacilityatKarnataka,andlaunchatleast1015productsduringFY201617inthecountry.
ForceMotors,autilityandcommercialvehiclesmanufacturer,inaugurateditsRs100crore(US$14.82million)
manufacturingfacilityinPune,whichwillsupplyenginesandaxlestotheGermanybasedautomobile
manufacturerMercedesBenz.
BoeingCompany,anAmericanplanemaker,andTataAdvancedSystemsLtd(TASL),afullyownedsubsidiaryof
TataSons,haveenteredintoajointventuretosetupanewfacilityinHyderabadtomanufactureBoeingAH64
Apachehelicopterfuselages.
PanasonicCorporationplanstosetupanewmanufacturingplantforrefrigeratorsinIndiawithaninvestmentof
Rs250crore(US$37million),andalsoinvestaroundRs20crore(US$3million)onanassemblyunitforlithium
ionbatteriesatitsexistingfacilityinJhajjarinthenext810months.
VitalPaperProducts,oneofthemajorsupplychainplayersinthepaperandpaperproductsindustry,planstoset
upapackagingproductunitintheSpecialEconomicZone(SEZ)ofSriCity,AndhraPradesh,ataninvestmentof
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Rs60crore(US$8.89million),whichwillbeoperationalfromApril2017.
IsuzuMotors,theJapanbasedutilityvehiclemanufacturer,hasinaugurateditsgreenfieldmanufacturingunitin
SriCity,AndhraPradesh,whichwassetupforRs3,000crore(US$444.72million),withanannualproduction
capacityof50,000unitsandisestimatedtogeneratearound2,0003,000jobs.
AirbushasprocuredmorethanUS$500millionworthofsuppliesfromIndiain2015,registeringagrowthof15per
centannuallyandhastargetedacumulativeprocurementofmorethanUS$2billionoveraperiodoffiveyearsup
to2020.
HavellsIndiaLimited,oneofthetopIndianconsumerelectricalequipmentproducer,planstosetupanew
manufacturingunitnearBengalurubymakinganinvestmentofRs1,059crore(US$156.99million),whichwould
beitstwelfthplantinIndiaanditsfirstoutsidenorthIndia.
GlobalbeveragecompanyPepsiplanstoinvestRs500crore(US$74million)tosetupanotherunitin
Maharashtratomakemango,pomegranateandorangebasedcitrusjuices,whilebiotechnologygiantMonsanto
planstosetupaseedplantinBuldhanadistrictofMaharashtra.
HindustanCocaColaBeveragesplanstosetupabottlingplantwithaninvestmentofRs750crore(US$111.2
million)inphasesatthefirstindustrialareabeingdevelopedbyGovernmentofMadhyaPradeshunderthepublic
privatepartnershipinBabaivillageofHoshangabad,Bhopal.
CanadasMagnaInternationalIncorporatedhasstartedproductionattwofacilitiesinGujaratsSanand,whichwill
(http://dashboardcommerce.gov.in/)
supplyautopartstoFordMotorCoinIndiaandwillemployaround600peopleatbothunits.
GovernmentInitiatives
Inabidtopushthe'MakeinIndia'initiativetothegloballevel,MrNarendraModi,PrimeMinisterofIndia,pitched
IndiaasamanufacturingdestinationattheWorldInternationalFairinGermany'sHannoverin2015.MrModi
showcasedIndiaasabusinessfriendlydestinationtoattractforeignbusinessestoinvestandmanufactureinthe
country.
TheGovernmentofIndiahastakenseveralinitiativestopromoteahealthyenvironmentforthegrowthof
manufacturingsectorinthecountry.Someofthenotableinitiativesanddevelopmentsare:
TheNationalInstitutionforTransformingIndia(NITIAayog),afteritsrecentpushforRs6,000crore(US$889
million)textilesectorpackage,aimstopersuadetheGovernmentforsimilarsupportinthemanufacturingsectors
withlargescaleemploymentgenerationopportunities,suchaselectricalandelectronicsengineering,footwear
andlightmanufacturingsegments,whichalsohaveexportpotential.
TheMinistryofLabourandEmploymentplanstorelaxcompliancemeasuresforMSMEsbyexemptingthemfrom
inspectionsrelatedtokeylabourlawsinordertoencourageentrepreneurstohelppromotemanufacturinginIndia.
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TheGovernmentofIndiaplanstogiveabigboosttolocalmanufacturingbyintroducingthenew'MakeinIndia
greenchannel',whichwillreducethetimetakenforcargoclearanceatportsfromaboutaweektoafewhours
withoutanyupfrontpaymentofduties.
Gujaratgovernmentisplanningtosetupanelectronicsproductsmanufacturinghubinthestate,throughitsnewly
announcedElectronicsPolicy2016,whichwillgenerateabout500,000jobsintheelectronicssectorinthenext
fiveyears.
TheMinistryofHeavyindustriesandPublicEnterprises,inpartnershipwithindustryassociations,hasannounced
creationofastartupcentreandatechnologyfundforthecapitalgoodssectortoprovidetechnical,businessand
financialresourcesandservicestostartupsinthefieldofmanufacturingandservices.
TheGovernmentofIndiaplanstoimplementanewDefenceProcurementPolicy(DPP)byApril,2016under
whichprioritywillbegiventotheindigenouslymadedefenceproductsand25percentshareofdefence
productionwillbeopentoprivatefirms.
TheGovernmentplanstoorganiseaMakeinIndiaweekinMumbaibetweenFebruary1318,2016toboostthe
MakeinIndiainitiativeandexpects1,000companiesfrom10keysectorstoparticipateintheexhibitionof
innovativeproductsandprocesses,ahackathonandsessionsonurbanplanning,amongotherevents.
NITIAayogplanstoreleaseablueprintforvarioustechnologicalinterventionswhichneedtobeincorporatedby
theIndianmanufacturingeconomy,withaviewtohaveasustainableedgeovercompetingneighbourslike
BangladeshandVietnamoverthelongterm.
MsNirmalaSitharaman,MinisterofState(IndependentCharge)forCommerceandIndustry,haslaunchedthe
TechnologyAcquisitionandDevelopmentFund(TADF)undertheNationalManufacturingPolicy(NMP)to
facilitateacquisitionofClean,GreenandEnergyEfficientTechnologies,byMicro,Small&MediumEnterprises
(MSMEs).
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TheGovernmentofIndiahasaskedNewDelhi'senvoysinover160countriestofocusoneconomicdiplomacyto
helpgovernmentattractinvestmentandtransformthe'MakeinIndia'campaignasuccesstoboostgrowthduring
theannualheadsofmissionsconference.PrimeMinister,MrModihasalsoutilisedtheopportunitytobriefNew
Delhi'senvoysabouttheGovernment'sForeignPolicypriorityandimmediatefocusonrestoringconfidenceof
foreigninvestorsandaugmentingforeigncapitalinflowtoincreasegrowthinmanufacturingsector.
TheGovernmentofUttarPradeshhassecuredinvestmentdealsvaluedatRs5,000crore(US$741.2million)for
settingupmobilemanufacturingunitsinthestate.
GovernmentofIndiahasplannedtoinvestUS$10billionintwosemiconductorplantsinordertofacilitate
electronicsmanufacturinginthecountry.
EntrepreneursofsmallscalebusinessesinIndiawillsoonbeabletoavailloansunderPradhanMantriMUDRA
Yojana(PMMY).ThethreeproductsavailableunderthePMMYinclude:ShishucoveringloansuptoRs50,000
(US$735),KishorcoveringloansbetweenRs50,000(US$735)toRs0.5million(US$7,340),andTarun
coveringloansbetweenRs0.5million(US$7,340)andRs1million(US$14,700).
RoadAhead<
TheGovernmentofIndiahasanambitiousplantolocallymanufactureasmanyas181products.Themovecould
helpinfrastructuresectorssuchaspower,oilandgas,andautomobilemanufacturingthatrequirelargecapital
(http://dashboardcommerce.gov.in/)
expenditureandrevivetheRs1,85,000crore(US$27.42billion)Indiancapitalgoodsbusiness.
Indiaisanattractivehubforforeigninvestmentsinthemanufacturingsector.Severalmobilephone,luxuryand
automobilebrands,amongothers,havesetuporarelookingtoestablishtheirmanufacturingbasesinthecountry.
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12/15/2016 ManufacturingSectorinIndia,ManufacturingIndustry,IndianIndustries
Withimpetusondevelopingindustrialcorridorsandsmartcities,thegovernmentaimstoensureholisticdevelopment
ofthenation.Thecorridorswouldfurtherassistinintegrating,monitoringanddevelopingaconduciveenvironmentfor
theindustrialdevelopmentandwillpromoteadvancepracticesinmanufacturing.
(//www.adnetworkperformance.com/a/display.php?r=308135&cb=)
ExchangeRateUsed:INR1=US$0.0149asonSeptember30,2016
MANUFACTURING INDIA
References:MediaReports,PressReleases,PressInformationBureau,McKinsey&Company
MANUFACTURINGCLUSTERS INDUSTRYCONTACTS
Notes:#AccordingtoTheYearbookareportbyUnitedNationsIndustrialDevelopmentOrganization(UNIDO)
ElectronicsIndustriesAssociationof
Disclaimer:ThisinformationhasbeencollectedthroughsecondaryresearchandIBEFisnotresponsibleforanyerrorsinthesame.
India(ELCINA)(http://www.elcina.com/)
TelecomEquipmentManufacturers
Association(TEMA)
(http://tematelecom.in/index.php)
IndianChemicalCouncil
(http://www.indianchemicalcouncil.com/)
AlkaliManufacturersAssociationof
India(http://www.amaindia.org/)
IndianSpecialtyChemical
PoweredbyDNSUnlocker(http://www.dnsunlocker.com) Manufacturers'Association
(http://www.iscma.in/)
(http://dashboardcommerce.gov.in/)
Indiaseconomy:Onastrongfoundation
(http://www.ibef.org/blogs/indiaseconomyonastrongfoundation)
AnuP.Mathai,IES,ChiefExecutiveOfficer,IBEF
India'scoresectoroutputindexgrewby5percentyearonyearat176.1in
September2016,ascomparedwith3.2percentyearonyeargrowth
recordedinAugust2016...
KentROSystems:Allaboutpurity!(http://www.ibef.org/blogs/kentro
systemsallaboutpurity)
Dr.MaheshGupta,Chairman&ManagingDirector,KentROSystems
Ltd
KentROSystemsisknownforrevolutionisingthewaterpurificationindustryin
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