Benefitting from the China plus one, Atmanirbhar Bharat, Make in India and PLI schemes, Indian manufacturing is through a golden streak. With global companies looking seriously for offshore partners and Indian companies investing in latest technology, the time is now. 2024 will be a defining moment, given the ambition to increase the sector’s share to 25 per cent of GDP by 2025.
Technology, digitalisation and skilling
Internet of Things, AI, ML, data analytics, robotics and overall digitalisation will have a greater impact on the manufacturing shop floor. Processes will be automated, efficiency will increase and quality will be best – in – class. Lean manufacturing will come to the fore and this will be enabled through digital twins where bulk of the planning can be done digitally, before implementing in the physical factory. All these would also trickle down to MSMEs who would start to benefit from it.
Apart from the manufacturing skills, employees must become digitally fluent to work in these factories of the future. Skilling and re-skilling will become imperative.
Supply chain issues
The war on land seems to have no end and it has spilled over to the sea. With the recent attack on container ships in Red sea, four large western shipping operators have suspended activities through the Suez canal. According to news agency Reuters, about 15 per cent of world shipping traffic transits via the Suez. It is the shortest shipping route between Europe and Asia. This disruption will cause considerable delays and is expected to affect industries on the whole. While the pandemic provided a glimpse of supply chain shortages, several industries have taken measures to near source their supplies. While this is still under progress, the shipping route threat can escalate shortages and pose a serious issue in the coming year.
Sustainability and circular economy
With climate concerns taking centre stage, incorporating sustainable practices and a circular approach will become mandatory for manufacturing. While technology can aid in this initiative, it primarily requires a mindset change. Extending usage of manufactured goods and utilising high quality materials to manufacture, lies at the core of this. Customer’s choice is slowly shifting towards brands that are aligned to sustainability. This will only increase going forward. With stringent norms across developed markets, Indian companies will also have to follow suit, in order to export the products to those regions.
Advanced Materials come to fore
Several parameters drive manufacturing and the key among them is materials. 2024 will see the emergence of new age material across major divisions. These will create a positive impact on manufacturers’ revenue and margins. With significant investments in the sector, India is on par with global benchmarks. Graphene, advanced polymers and composites, nano materials, smart materials, metal alloys, ceramics and coatings are all areas where major developments are taking place. The advanced materials market was valued at USD 5 billion in 2021 and is expected to grow at a CAGR of about 10-12 per cent.
