How many factories set up every year in India?

 Introduction

Manufacturing has emerged as one of the high growth sectors in India. Prime Minister of India, Mr Narendra Modi, launched the ‘Make in India’ program to place India on the world map as a manufacturing hub and give global recognition to the Indian economy. Government aims to create 100 million new jobs in the sector by 2022.

Market Size

The sector’s gross value added (GVA) at current prices was estimated at US$ 348.53 billion as per the second advanced estimates of FY21. The IHS Markit India Manufacturing Purchasing Managers Index (PMI) reached 55.5 in April 2021 from 55.4 in March 2021. The manufacturing GVA accounts for 19% of the country's real gross value added.

As per the latest survey, capacity utilisation in India’s manufacturing sector stood at 66.6% in the third quarter of FY21.

The manufacturing component of the IIP stood at 116.9 between April 2020 and March 2021.

According to the Ministry of Statistics & Programme Implementation, India’s industrial output measured by the Index of Industrial Production (IIP) stood at 143.4 in March 2021.

Investments

With the help of Make in India drive, India is on a path of becoming the hub for hi-tech manufacturing as global giants such as GE, Siemens, HTC, Toshiba, and Boeing have either set up or are in process of setting up manufacturing plants in India, attracted by India's market of more than a billion consumers and an increasing purchasing power.

In May 2020, the Government of India increased FDI in defence manufacturing under the automatic route from 49% to 74%.

India has become one of the most attractive destinations for investment in the manufacturing sector. Some of the major investments and developments in this sector in the recent past are:

• In FY21, India received a total foreign direct investment (FDI) infl­ow of US$ 81.72 billion, a 10% increase YoY.
• On February 16, 2021, Amazon India announced to start manufacturing electronic products in India, starting first with Amazon Fire TV stick manufacturing. The company plans to start manufacturing with contract manufacturer Cloud Network Technology, a subsidiary of Foxconn in Chennai by end-2021.
• In April 2021, Samsung started manufacturing mobile display panels at its Noida plant and plans to ramp up manufacturing IT display panels soon.
  • Samsung Display Noida, which has invested Rs. 4,825 crore (US$ 650.42 million) to move its mobile and IT display manufacturing plant from China to Uttar Pradesh, has received special incentives from the state government.
• In April 2021, Bharti Enterprises Ltd. and Dixon Technologies (India) Ltd., formed a joint venture to take advantage of the government's PLI scheme for the manufacturing of telecom and networking products.
• In April 2021, Godrej Appliances launched a range of Made-in-India air conditioners (AC). The company plans to invest Rs. 100 crore (US$ 13.48 million) in its manufacturing units (located in Shirwal and Mohali) to increase its AC production capacity to 8 lakh units by 2025.