Manufacturing share in GDP lowest in 10 yrs.
This compares unfavourably with China, where manufacturing contributes a whopping 30 per cent to its GDP. According to a survey conducted jointly by the Confederation of Indian Industry ( CII) and the Boston Consulting Group ( BCG), 83 per cent executive directors of companies that participated in the survey feel that slowdown in demand had the biggest impact on the manufacturing sector in the past 12 months. More than 75 executive directors of manufacturing companies in India participated in the survey. The report was released on the eve of the 12th Manufacturing Summit, organised in Mumbai by the CII. " It is necessary for manufacturing companies to step back and filter out the structural trends affecting manufacturing from the noise of day- to- day fire- fighting," Jamshyd N. Godrej, chairman and managing director, Godrej and Boyce Manufacturing, said in the report.
" We believe that the context of manufacturing has changed. The new environment is characterised by shocks, swings and shortages," said Godrej, who is also the chairman of CII 12th Manufacturing Summit.
There is a distinct slump in Indian manufacturing.
Its GDP growth has slipped from an average of 10 per cent between 2005 and 2011 ( compound annual growth rate) to 2.7 per cent in 2011/ 2012 and a meagre one per cent in 2012/ 13.
Despite the recent slowdown, long- term prospects of the Indian manufacturing sector remain robust, the report said.
BCG polled more than 70 CEOs and discovered some optimism. Eighty per cent of the respondents of the survey, done in association with CII, expected their company's growth over the next five years to be greater than the last five years.
Forty- two per cent said that they are more confident about a rebound in India's manufacturing growth in the next two years to pre- 2010/ 2011 averages.
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