Get In Touch
June2024 104x80.jpg
Current Issue

animation-neutral-tts-300x100' width='300' height='100' border='0

India's industrial renaissance: Harnessing robotics & automation for manufacturing growth

By Raghav Gupta, Vice President, Endiya Partners,

Added 20 June 2024

The article delves into how India can augment its global competitiveness and long-term productivity by leveraging digital transformation and robotic automation.

India's manufacturing industry is at a pivotal moment today. With the world's supply chains undergoing a shift, India is perfectly positioned to become a major player, offering a strong alternative to our eastern neighbor. However, we must act swiftly to accomplish our ambitious objectives.

The Government of India's objective is to increase the manufacturing sector's share to 25 per cent of GDP, up from the current roughly 15 per cent, as part of the Make in India initiative. To achieve this, the Economic Survey of India 2019-20 paints a compelling narrative of an export-led strategy focused on product assembly and discrete manufacturing. While this presents a real and significant opportunity, it would require focusing efforts on industries within the product assembly space where large economies of scale and vertical integration can be achieved on a war footing. Notably, the current industrial policy and fiscal incentives have been designed to achieve exactly this— eight out of 14 sectors covered under the PLI constitute high-growth product assembly.

These sectors have already begun to show results. Auto component exports exceeded 30 per cent of industry revenue in FY24. Similarly, we witnessed a 22.24 per cent surge in electronics exports in FY24, breaching the $20 billion milestone three quarters into the year.

Emerging signs of progress, evidenced by the rise in exports, credit, and tax payments for both SMEs and large enterprises in these sectors, underscore the potential.

Building and increasing competitiveness

To empower our companies to compete in global markets, we need to focus on increasing ecosystem competitiveness.

This will not only increase firm-level growth and profitability but also secure higher living standards for workers. Increasing competitiveness will depend on improving long-term productivity (not low wages or currency arbitrage), majorly led by digital transformation and robotic automation.

Notably, product assembly-based industries, globally (particularly automotive and electronics) have been at the forefront of adopting robotic automation to streamline operations, improve quality, and increase productivity. This trend is starting to take hold in India as well.

The World Robotics Report 2022 highlights the correlation between the presence of large manufacturing hubs and investment in robotics. China, Japan, the US, South Korea, and Germany account for 78 per cent of global robot installations. India showed up in the 10th spot on the list, underscoring its nascent journey. With considerable whitespace waiting to be filled, the potential for the growth of robotics in India is immense.

Robotics for the Indian market

While Indian manufacturing is progressing towards establishing its global presence, automation solutions that are effective globally don't pass the ROI test in India. There exists an optimal balance between fully customised solutions and generalised autonomy that is waiting to be built at a price point suitable for Indian industrial applications.

Moreover, the vision of taking manufacturing to 25 per cent of GDP should go beyond profitability to encompass improvements in productivity, the production of higher-quality goods, and the creation of highly skilled job opportunities. These are all advantages that will materialise as we devise indigenous solutions for digital transformation and robotic automation tailored to our specific requirements and ecosystem.

comments powered by Disqus