Over the past few years, the manufacturing sector's percentage of GDP has stayed constant at between 13–17%.
Delhi, New Delhi: According to a survey by the Confederation of Indian Industries (CII), manufacturing companies are expected to increase their spending in technology integration from the current 10% of their overall budget to 11–15% over the next two years.According to the paper "Smart Manufacturing: Unlocking India's Potential," these increased expenditures are probably going to go toward robotics, big data, and the Internet of Things (IoT).
This could be significant since, despite services driving growth in India's economic output, the manufacturing sector's percentage of GDP has stayed constant over the past few years at roughly 13–17%.
According to the report, traditional industries like textiles and food processing are progressively moving towards digitization, while capital-intensive sectors like semiconductors, aerospace, and automotive are spearheading the adoption of new technologies.
According to Annual Survey of Industries (ASI) data issued in September of this year, manufacturing employed approximately 18.4 million people in FY23, which is roughly 7.5% more than the 17.2 million in FY22.
According to the report, there is potential for development as less than one-third of Indian companies in important manufacturing sectors reap the benefits of the integrated information technology (IT) connectivity they have established among subsystems.
Integration of IT connectivity
According to the data, 20% of the companies examined had little to no IT network integration in place.
Only 30% of businesses with highly integrated IT systems enjoy the benefits of smooth subsystem communication, which permits real-time data analysis and facilitates quick decision-making. According to the CII research, this shows that there is a lot of space for development, particularly for the 20% that have little to no integration.
According to CII's extensive surveys conducted throughout the Indian manufacturing sector, the majority of Indian businesses are dedicated to digitization and technology adoption at a time when automation technologies and artificial intelligence (AI) are becoming more and more popular worldwide.
Although many businesses are dedicated to investing in technology and turning digital, CII found variation among these sectors, especially in industries like capital goods, chemicals, electronics, and steel.
According to CII's report, there is more variation in the automotive industry, ranging from companies with no strategy at all to those with highly committed and clear strategies. In contrast, many companies in the electronics sector have well-defined strategies with a high commitment to technology integration.
According to the CII analysis, this is because different market sectors and company sizes were noted in the automotive industry.
With many enterprises either having a defined path towards technology investments or in the process of formulating such investment plans, the capital goods sector is strengthening its technological inclusion. "Larger companies are likely leading the charge, but smaller ones are catching up," the research from the CII stated.
According to the survey, there are still issues facing the manufacturing sector, particularly for small and medium-sized businesses (SMEs), including high costs, hazy returns on investment, and the integration of outdated systems. The research also emphasizes how critical it is to upskill the workforce in order to close the skills gap and facilitate the smooth adoption of cutting-edge technologies.
In the report, CII suggested that in order to promote the wider adoption of smart manufacturing, more public-private partnerships be formed to create shared technology hubs, industry-academia collaboration be strengthened, supportive policies be put in place, and budgetary allocations for technology be increased.
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