India is fast emerging as a global manufacturing hub with a large number of companies shifting their manufacturing base to the country. India's manufacturing value added has grown by over 10%, compared to 3.4% for the industrialized countries. The share of China, India and Brazil in the world manufacturing output is now 32%, up from 20% a decade ago.
Experts say the data reinforces the need to increase the manufacturing sector's contribution to the GDP from 16% to 25% over the next decade, as announced by the finance minister in his budget speech, as "concrete" economic growth will only come from industry and not services.
With this new manufacturing opportunity slated to be more skills intensive, the industry leaders foresee India as well poised to take advantage of this shift. Indian Manufacturing Industry should move beyond the traditional manufacturing systems and must look at developing new models
With a host of firms from Japanese automakers to telecom equipment producers moving to India, manufacturing could overtake services as the engine of growth. This is desirable, as services-led economies are vulnerable to financial upheavals.