 "Six industries contribute over 50% of formal sector manufacturing GVA: NSO")
Six out of 29 major industries contributed more than half of India’s formal manufacturing sector gross value added (GVA) in 2022-23, additional annual survey of industries (ASI) data released by the National Statistical Office (NSO) on Wednesday showed.
This highlights the skewed nature of productivity in the manufacturing sector. Producers in most of the industry groups only added marginal value to the final goods and services, thus keeping their contribution to the total GVA low.
Data showed that the combined contribution of industries such as basic metals, chemical & chemical products, refined petroleum, motor vehicles, pharmaceuticals and food products stood at 52.6 per cent in FY23.
Of this, the share of basic metals and chemical & chemical products alone stood at 22 per cent. The remaining contribution came from the other four industries.
In comparison, the share of these six industries had stood at 55.78 per cent in the preceding fiscal year.
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The share of basic metals industry (11.6 per cent), chemical & chemical products (9.8 per cent) and pharmaceuticals (7.3 per cent) declined from the previous year.
But the share of the automobile industry (8.07 per cent), food products (7.14 per cent) and refined petroleum (8.7 per cent) improved in their contribution to India’s formal sector manufacturing output.
Data further shows that only five states contributed over half of India's manufacturing GVA in FY23. The combined contribution of Maharashtra (16.3 per cent), Gujarat (14.8 per cent), Tamil Nadu (10.3 per cent), Karnataka (7.04 per cent) and Uttar Pradesh (6.1 per cent) stood at 54.7 per cent. This is slightly up from 53.3 per cent in FY22.
Among them, barring Karnataka (7.04 per cent), the other four states saw an increase in their contribution to the total GVA in FY23.
Manufacturing GVA had grown by 7.3 per cent in 2022-23 to Rs 21.97 trillion (current prices) compared to the previous year.
Earlier, data released by NSO for FY23 in September had shown that employment in the formal manufacturing sector rose at the fastest pace in 12 years in 2022-23. It saw 1.3 million fresh jobs being created compared to 1.1 million in 2021-22.
Cumulatively, the total number of people engaged in the manufacturing sector had grown by 7.4 per cent in 2022-23 to 18.5 million. On the other hand, the total number of factories increased to 253,000 in 2022-23 from 249,000 in 2021-22.
The survey of the formal manufacturing sector by NSO provides crucial insights into the changing dynamics of India’s manufacturing industries in terms of output, employment, and capital formation.
It primarily covers factories registered under the Factories Act, 1948, as well as beedi and cigar manufacturing establishments as well as electricity undertakings not registered with the Central Electricity Authority. It also includes establishments with over 100 employees registered in the Business Register of Establishments (BRE) prepared and maintained by the state governments.