With approximately 27.3 million people and a GDP contribution of over 17%, manufacturing is already a major economic force in India. The manufacturing sector’s good advances build a strong foundation for long-term economic growth that might propel India into a major global manufacturing hub. However, changing the manufacturing process is necessary to achieve long-term success.
Delhi, New: A nation can only become an economic superpower if its manufacturing sector is robust. India hopes to reach its lofty objective of being a USD 5 trillion economy by 2026–2027. To do so, the manufacturing sector will need to become more and more vital. India has a huge opportunity due to the shifting global landscape brought about by the pandemic and geopolitical tensions, which have forced other nations to alter their ways.
Manufacturing already contributes significantly to the Indian economy, employing over 27.3 million people and accounting for over 17% of the country’s GDP. The manufacturing sector’s favorable advances build a strong foundation for long-term economic growth, which might propel India into a major global manufacturing hub.
India wants to achieve $1 trillion in manufacturing exports and 25% of its economy will come from the manufacturing sector shortly. Creating globally competitive manufacturing clusters is one of India’s best chances to promote economic expansion and job creation this decade, according to a McKinsey Global Institute analysis. Imperatively, the next move is to deal with current issues and enable a seamless shift to investments driven by technology to set the ground for India’s global ascent.
India’s manufacturing “Techade”
The execution of infrastructure projects by the Indian government is one of the many elements that have boosted the industrial sector’s potential for long-term growth. The much-needed boost to India’s manufacturing ecosystem has come from the impact of policy reforms under the ‘Make In India’ program and the growing acceptance of the simplified tax regime among enterprises of all sizes.
However, changing the manufacturing process will be necessary to achieve long-term success. Businesses need to view a factory as a living, breathing ecosystem as much as a location of production. According to this perspective, technology is a reliable ally, and to succeed during this “era” (2020–2030), players must take advantage of India’s fervor. The transformation of micro, small, and medium-sized firms (MSMEs) in India is crucial for the country’s aspirations towards future manufacturing. 36% of India’s total manufacturing output is produced by these MSMEs, 90% of which are involved in the manufacturing process.
Despite having a big influence on Indian manufacturing, many MSMEs are disadvantaged by a lack of technological adoption. These MSMEs must fully embrace digitization to attain manufacturing excellence if India is to become a hub for global manufacturing.
Skilled labor availability is another issue facing the manufacturing industry. India’s population, which is 28 years old on average, is in a prime position to outpace industrial production. However, industrial orientation and skill-based training are essential given India’s large talent pool to produce a workforce that the manufacturers can profitably employ. Furthermore, enhancing working conditions, safety, perks, and talent retention tactics will be critical for the next stage of expansion.
Indian manufacturing transitions to Industry 4.0
To increase productivity and efficiency in production, Indian enterprises are progressively embracing “digital transformation,” according to Rockwell Automation’s 2023 State of Smart Production Report.
35% of the operating budgets of Indian enterprises are allocated to technology expenditures. According to the report, manufacturers must make a concerted shift toward automation if they are to boost output, reduce risks, seize new possibilities, maintain their competitiveness, and attain sustainability.
Eleven industrial value chains are identified in a McKinsey analysis as having the potential to increase India’s gross value added (GVA) by roughly USD 320 billion by 2027. To assist these value chains achieve productivity and production levels that are globally competitive, significant changes in strategy and funding are required. Robots are being used more often by Indian firms to carry out repetitive jobs, freeing up human labor for more intricate and creative duties. They must solve issues with infrastructure, cybersecurity, and talent development if they are to properly adopt Industry 4.0.
Using intelligent machinery and systems to support smart manufacturing is a positive step in the right direction. Smart devices allow players to plan well with better information and insights to optimize productivity, quality, risk management, and sustainability. They also enable quick and efficient problem resolution, reducing downtime and risks to workers, assets, and reputation. Smart systems can significantly reduce programming time.
Modern intelligent machines transcend traditional paradigms for control, operation, and maintenance by transforming data into insights for improved decision-making. By utilizing edge-to-enterprise analytics, machine learning, the industrial internet of things (IIoT), augmented reality (AR), and other technologies, smart manufacturing helps enterprises to successfully manage the convergence of information technology (IT) and operational technology (OT).
India faces enormous opportunities as well as daunting challenges in its quest to become a worldwide center of manufacturing. Automation technologies help simplify production environments, unleash extraordinary innovation, improve system lifecycle management, and help mitigate cybersecurity and safety risks. Industry leaders are embracing automation technologies in response to these complex and multifaceted challenges, which include a lack of skilled workers, an unpredictable supply chain, regulatory mandates, increased risks, and an increasingly competitive global marketplace.
Expanding the use of smart manufacturing will be essential for improving output, making data-driven decisions, and making sure technology is acknowledged as a differentiator in the market. Last but not least, cooperation between the public and private sectors as well as academic institutions would be crucial to realizing the goal of India being a manufacturing hub. As we proceed, all parties involved must take this revolutionary step together, solidifying India’s standing as a world leader in manufacturing.