India’s manufacturing sector at present has a target of contributing 16 per cent of GDP to the nation’s exchequer. By 2025, the sector is expected to deliver 25 per cent. Over the next five years, India is expected to capture the fifth spot in the list of most competitive manufacturing nations in the globe.
Capacity creation in sectors like infrastructure, power, mining, oil and gas, refinery, steel, automotive, and consumer durables has been driving demand in sectors like engineering. Engineering exports, net worth at $ 70.6 billion in FY 2015, registered a CAGR of 11.1 per cent over the earlier years. Elements like manufacturing costs, market knowledge, technology and creativity has been a driving force.
Foreign Direct Investment jumped 18 per cent to a record level of $46.4 billion in 2016, the proportion of investments directed towards manufacturing also increased.The overall composition of FDI in 2016 turned towards the manufacturing sector, which registered a 38 per cent annual rise in inflows. Bulks of these investments were done in some of the states of the country. Maharashtra, Karnataka and Madhya Pradesh have witnessed the biggest spurt in new industrial investments over the past two years, with most new industrial units being set up in these states.
The Make in India initiative was launched in the year September 2014 primarily with the goal of transforming the country into a global manufacturing hub. The idea was to encourage both the global as well as the domestic companies to set up manufacturing units within India. The aim was to raise the contribution of the manufacturing sector to 25 per cent of the gross domestic product (GDP) by the year 2025 from the current 16 per cent.
