Featured Image

International News From the Field: India

This year, India is predicted to have the highest GDP growth of any large country at more than 11%. The PMI is above 57, and business has resumed at almost pre-pandemic levels.
Mar 01, 2021

This year, India is predicted to have the highest GDP growth of any large country at more than 11%. The PMI is above 57, and business has resumed at almost pre-pandemic levels. The government continues to aggressively incentivize local manufacturing with the PLI scheme, revisions to FDI and defense policies, and major infrastructure programs. For more industry intel and other tidbits, read on.

  • India’s manufacturing PMI continued its robustness in January 2021, clocking 57.7, up from 56.4 in December 2020. Additionally, the International Monetary Fund (IMF) revised India’s annual GDP growth projection for 2021 upwards from 8.8% to 11.5%. The annual GDP growth for 2022 is projected to be around 7%. According to Nomura (NIBRI), India’s business resumption index was above 99.3 for the week ending Feb. 21, 2021, which is almost back to pre-pandemic levels.

  • To further stimulate the economy, the Indian government has announced their plan to invest $1.4 trillion in the infrastructure sector over the next five years for building new roads, bridges, seaports, airports, railways, and mass transportation. These investments, in turn, will create demand for manufacturing technology in sectors like commercial vehicles, construction machinery, cement, power, and more.

  • In the recently concluded Aero-India trade show in Bangalore, there was a strong push toward achieving self-reliance by promoting local manufacturing and exports in the defense and aerospace sectors. Thirty-four companies signed MOUs with the Karnataka government for projects worth over $400 million. Similarly, the Uttar Pradesh-based defense corridor attracted investments worth over $650 million. India is planning to invest $130 billion over the next five years to procure new equipment and modernize its defense infrastructure. As previously reported, FDI of up to 74% is now allowed in the defense sector.

  • The medical device sector is presently a $12 billion industry and growing at a CAGR of 15%. The industry is likely to grow to $50 billion by the year 2025. Earlier this month, the government approved many applications for manufacturing medical devices under the Production Linked Incentive (PLI) scheme. The approved companies include Siemens Healthcare, Nipro India, Wipro-GE, and Sahajanand Medical Technologies. The total committed investment by these four companies alone is $110 million.

Some recently announced projects and investments further illustrate the vast opportunities in India.

  • Tesla is in the process of acquiring land to set up their manufacturing plant on the outskirts of Bangalore. Tesla would complete assembly of their Model 3 at the facility.

  • Ampere Electric, a wholly owned electric mobility subsidiary of Greaves cotton, is investing around $100 million to set up an electric mobility scooter plant in Ranipet, Tamilnadu.

  • Hyundai is planning to invest $200 million to build EVs for the mass market in India.

  • Amazon is opening their first manufacturing line near Chennai to produce Fire TV devices in partnership with Foxconn-owned Cloud Network Technology.

  • JSW Energy is planning to invest $1.6 billion to build up capacity for 1800 MW of renewable energy.

  • Bharat Forge will make armored vehicles in India in partnership with South Africa’s Paramount Group.

  • Hindustan Aeronautics Limited (HAL) signed an MOU with Mishra Dhatu Nigam (MIDHANI) for the development and production of composite raw materials.

  • Thermo Fisher is setting up a manufacturing facility in Bengaluru to produce customized COVID-19 testing kits suited to local conditions.

For more information, contact Arun Mahajan (AMahajan@AMTonline.org).

PicturePicture
Author
Arun Mahajan
General Manager - AMT India Operation
Recent international News
India’s industry is humming along at a pre-pandemic pace, if not better. The PMI is above 55. Vehicle sales are up 34% YOY, with commercial vehicles up 165%. The new Vehicle Scrappage Policy was launched, which will attract billions of dollars in new ...
Due to the pandemic’s second wave in India, June’s manufacturing Purchasing Managers’ Index (PMI) contracted, dipping below 50 for the first time in 11 months. However, the worst is over, and the business resumption index jumped from 92% to 96% last week.
Since the second week of May, the effects of India’s COVID-19 resurgence that has held the world’s attention have subsided. The lockdowns are easing, and local businesses are opening again.
The ADB still predicts India’s GDP will rebound strongly at 11% in FY 2021 due to continued economic recovery stimulated by increased public investment, the vaccine rollout, and the surge in domestic demand.
Despite grappling with the pandemic’s second wave, India’s manufacturing purchasing managers’ index (PMI) remained quite strong at 55.5 in April. India continues to claw its way forward, maintaining the forecast for recovery and economic opportunity...
Similar News
undefined
Technology
By Vanesa Powers | Sep 16, 2021

In the age of digital manufacturing, data systems have become more critical. The migration to these services from physical or existing digital systems requires thorough planning and a solid connection to business processes.

7 min
undefined
International
By Carlos Mortera | Aug 17, 2021

In this second part, we review the state of the mold and die industry by geographic locations.

5 min
undefined
International
By Arun Mahajan | Aug 30, 2021

India’s industry is humming along at a pre-pandemic pace, if not better. The PMI is above 55. Vehicle sales are up 34% YOY, with commercial vehicles up 165%. The new Vehicle Scrappage Policy was launched, which will attract billions of dollars in new ...

5 min