Indian manufacturing reached its lowest point in 10 years with a 15.1 per cent share of manufacturing in overall GDP, according to a joint report released by the Confederation of Indian Industry (CII) and The Boston Consulting group (BCG).
According to the report called “Powering Past Headwinds-Indian Manufacturing: Winning in an era of shocks, swings and shortages”, slowdown in domestic demand has had the biggest impact on the manufacturing sector in the past 12 months.
Godrej & Boyce chairman and managing director Jamshyd N Godrej said, “It is necessary for manufacturing companies to step back and filter out the structural trends effecting manufacturing from the noise of day to day fighting. We believe the context of manufacturing has changed. The new environment is characterised by shocks, swings and shortages”.
Despite the slowdown, the report paints an optimistic picture of manufacturing going forward stating that the sector growth over the next 5 years will be greater than that in the past five years.
Corporates are also more confident of exports picking up with these seen as a key demand driver. Within manufacturing, textiles and pharmaceuticals are doing better than other sectors, the report said.
Commenting on the report, BCG India managing director Arindam Bhattacharya said, “ Adaptiveness holds the key to success in the current environment. Adaptiveness is not about minimising and managing risk. It is about adapting to the environment and finding growth opportunities in adversity.