Manufacturing could create 25 million new jobs in India

RP news wires, Noria Corporation

India’s manufacturing is well-poised to create 25 million new jobs, of which the textiles sector alone will provide for employment opportunities to nine to 10 million people by 2010, and is also projected to substantially enhance its contribution to GDP, according to the findings of The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

In a paper prepared on “Manufacturing: India’s Growth Locomotive,” it has also been projected that the manufacturing exports from India will shoot up to US$100 billion by 2010 from its present level of about US$50 billion.

Releasing the paper in New Delhi today, ASSOCHAM president Anil K. Agarwal said that sectors such as machine tools, auto components, pharmaceuticals and engineering, besides textiles, have tremendous growth potential to accelerate manufacturing and, therefore, create ample opportunities for employment.

It may be mentioned that the textile sector as of now alone provides direct employment to around 35 million people, including manufacturers, suppliers, wholesalers and exporters of cotton textiles, handlooms and woolen textiles. The contribution of the manufacturing sector as a whole to India’s GDP today staggers around 17 percent, compared to China, Korea and Thailand where it forms around one-third of their GDP.

Quoting the findings of the paper, Agarwal pointed out that the global trends to manufacturing and soured products in low-cost countries like India will gather strength over the next 10 years, particularly in skilled intensive industries in which country like India will significantly have competitive advantages.

In a bid to achieve the projected acceleration in manufacturing growth, the focus and efforts of policy makers should be toward creating an environment for higher investments and also induction of technologies in sectors such as textiles, engineering, auto components and machine tools.

The chamber is also of the view that infrastructure bottlenecks still continue to make Indian manufacturing highly uncompetitive especially within the ASEAN region. Therefore, basic infrastructure needs for industries should be met to increase manufacturing in areas of telecommunication, pharmaceuticals, consumer electronics and IT related services to help India diversify its export manufacturing.

The removal of world textile quota restrictions from January 2005 could bring a huge increase in India’ annual exports and make it the big winner in the global market, after China. This breakthrough will occur, however, only if the government accelerates the pace of reform and local manufacturers adopt measures to improve their competitiveness.