The industry holds a prominent position in the Indian economy, accounting for 31 percent of GDP, on average, during FY12 and FY21 and employing over 12.1 crore people. The sector’s relevance can be identified through various direct and indirect linkages with other sectors, contributing to economic growth and employment, the Economic Survey 2022-23 released on January 31 said.
Investments of Rs 47,500 crore were seen under the Production Linked Incentive (PLI) schemes in FY22, which is 106 percent of the designated target for the year. Production/sales worth Rs 3.85 lakh crore and employment generation of 3 lakh have been recorded due to PLI schemes.
The scheme is expected to attract a capex of approximately Rs 3 lakh crore over the next five years. It has the potential to generate employment for over 60 lakh in India and increase the share of the manufacturing sector in total capital formation, which currently stands at around 17-20 per cent between FY12 and FY20.
Moneycontrol looks into major sectors that are poised to generate employment as per the Economic Survey 2023.
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Textile sector
To boost the production capacity, the government launched the Textile PLI Scheme with an approved outlay of Rs 10,683 crore over five years starting from January 1, 2022 to promote investments and increase the production of Man-Made Fibre (MMF) Apparel, MMF Fabrics and Products of Technical Textiles.
In the approved 64 applications, so far, the proposed investment commitment is Rs 19,798 crore, with projected turnover and employment generation of Rs 1.9 lakh crore and 2.5 lakh, respectively.
To develop integrated large-scale and modern industrial infrastructure facilities for the entire value chain of the textile industry, the government approved the setting up of seven PM Mega Integrated Textile Region and Apparel (PM MITRA) Parks.
“The parks will not only reduce logistics costs and improve the competitiveness of Indian Textiles but also boost employment generation, attract domestic investment and FDI, and position India firmly in the global textile market. The parks are expected to create a total of one lakh direct and two lakh indirect employment,” the Economic Survey said.
Pharmaceutical sector
Indian pharmaceutical exports achieved a healthy growth of 24 percent in FY21, driven by Covid-19-induced demand for critical drugs and other supplies made to over 150 countries, the survey said.
The performance of pharma exports in FY22 has been robust, sustaining growth despite the global trade disruptions and drop in demand for Covid-19-related treatments, it added.
Three PLI Schemes were launched to boost manufacturing capacity in the pharmaceutical sector for ‘Critical KSMs/DIs/APIs’, Medical Devices, and ‘Pharmaceuticals’. All are estimated to generate over 1.17 lakh direct and indirect jobs.
Steel sector
As many as 67 applications from 30 companies were picked under the PLI scheme for specialty steel. This will attract a committed investment of Rs 42,500 crore, with an increase in capacity by almost 26 million tons and an employment generation potential of nearly 70,000 people, the survey said.
Auto sector
In December 2022, India became the third largest automobile market, surpassing Japan and Germany in terms of sales. As of 2021, the sector generated direct and indirect employment of 3.7 crore.
With a tenure of 2023-27, PLI schemes for ‘Advanced Chemistry Cell’ and ‘Auto and Auto-component’ are estimated to generate around 3.38 lakh jobs. Besides, the EV industry will create 5 crore direct and indirect jobs by 2030, as per the Economic Survey 2023.
MSMEs
Micro, Small and Medium Enterprises (MSMEs) registered on the portal Udyam employ 9.6 crore people of which 2.3 crore are women. There are 1.5 lakh exporting units, which have contributed a cumulative ₹9.7 lakh crore worth of exports.
The survey stated said more than 100 MSMEs are among the PLI beneficiaries in sectors such as bulk drugs, medical devices, telecom, white goods and food processing.
Key sectors such as large-scale electronics manufacturing, pharmaceuticals, telecom & networking products, food processing and white goods have contributed considerably to investment, production, sales and employment.
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