The resurgence of India’s manufacturing sector in the past last few years has been quite magical. Not only have profits been soaring, but the sector is also witnessing increased employment opportunities and is fast spreading its roots abroad. Many Indian manufacturing firms are today close to becoming true-blue multinationals.
It was only after 2003 that the sector started seeing strong development, with technology revolutions, liberalisation and globalisation. This was the time when Indian manufacturing displayed a sturdy rise of more than 9 per cent, thus ensuring more employment opportunities.
Elixir identifies the following four segments to be the major ones in the Indian manufacturing industry for contribution to overall sectoral growth and employment generation rate.
1) The auto components market, which is growing at 15 per cent a year. Exports have grown at a compounded rate of 19 per cent.
2) The textiles and garments segment, which is one of the largest employers and thus important for the Indian economy.
3) Pharmaceuticals, with growth rate of 6-8 per cent over the last two years, continues its sturdy progress.
4) Engineering goods, too, have emerged as a dynamic segment in the country’s industrial economy.
Based on the rate at which foreign investments are proceeding, industry specialists have noted that nearly 10 million people will join the manufacturing sector work-force annually and about 25 million new jobs are to arise in the segment by 2015.
{{/usCountry}}Based on the rate at which foreign investments are proceeding, industry specialists have noted that nearly 10 million people will join the manufacturing sector work-force annually and about 25 million new jobs are to arise in the segment by 2015.
{{/usCountry}}India has a big advantage when it comes to cost-effective labour and highly skilled manpower, and this has led to foreign majors either announcing plans to set up large production units here, or outsourcing of manufacturing to the country.
Our rich domestic raw material base adds to the potential. Our estimates say the country will have 25 per cent of its population in the 25-30 age group by 2020. Also, the high percentage of our English speaking population, managerial excellence and existence of strong technological capabilities have their own major contribution to make.
With the hiring intentions of companies being lot more open now, the sector has recorded a net employment outlook of 40 per cent, which is a rise of 15 per cent over the previous year.
However, there are big challenges facing Indian manufacturing. To address these, the government and the industry need to put in efforts, preferably through a well-designed public-private partnership mode on increasing competitiveness.
(The author is managing partner at Elixir Web Solutions, a human resources consultancy)