A troubling snapshot of Indian manufacturing
A NITI Aayog and IDFC Institute's 'Ease of Doing Business' report sharply delineates the manufacturing sector's problems
There are a handful of accepted truths about Indian manufacturing. Enterprises in this sector have a growth problem, often turning out to be “dwarfs" rather than “babies". These dwarfs dominate the sector numbers-wise. They suffer from low productivity given that their small size prevents them from achieving economies of scale, among other disadvantages. However, they employ a huge chunk of the labour force. The recently released Ease Of Doing Business report by NITI Aayog and the IDFC Institute, based on an enterprise survey carried out in 2016, lends some welcome empirical heft to these truths, and delineates the problems sharply.