ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

Manufacturing sectorSubscribe to Manufacturing sector

Budget 2021–22 and the Manufacturing Sector

The growth rate of manufacturing value added has been declining continuously since 2016–17 and it had become negative in 2019–20, even before the intensification of the Covid-19 crisis, suggesting that the budget needs to address the structural weaknesses of the economy. The 2021–22 budget has largely adopted the supply side corrective measures in the form of increased capital expenditure on infrastructure. The potential of infrastructure investment in reviving the sector and the implications of the proposed resource mobilisation for financing the increased capital expenditure are discussed. In the context of increased global fragmentation of production, the feasibility of promoting domestic production through tariff protection is also discussed.

Has India Deindustrialised Prematurely?

Has India deindustrialised prematurely, after three decades of free market reforms? Probably not. The manufacturing sector’s share in gross domestic product has stagnated, and Kuznetsian structural transformation has stalled. The dispersion and rankings of the major states’ manufacturing employment and output shares have broadly remained unchanged. In the top and bottom 50 districts, the share of manufacturing employment in total employment has remained constant since 1991. Yet, the district-level spatial concentration of employment by industry has increased, and the coefficient of localisation is rising. Thus, the industrial change discernible at the micro level seems too feeble to show up in the aggregate.

Production-Sharing in East Asia

Despite beginning the industrialisation process ahead of most of east Asia, India's manufactured exports as a whole have stagnated when benchmarked against east Asia. While its east Asian neighbours have been able to move rapidly from manufactured labour-intensive commodities, India has largely been left out of the production-sharing process. If India is to become a manufacturing powerhouse like China and most of the other middle-income countries in east Asia, it needs to take steps to integrate more effectively and intensively with the rest of east Asia and become an important participant in the regional and global division of labour.

What Ails Kerala's Economy:A Sectoral Exploration

The `Kerala model' of development has been facing a serious crisis due to low growth, high cost, low productivity, low investment and low employment in the state economy. This paper analyses the performance of major sectors of the state economy, such as agriculture, industry and the financial sector, during the past two decades and brings out the problems they confront. The paper highlights the lack of a development strategy in Kerala for growth and employment generation.
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