Manufacturing in India and Other BRICS Countries: A Stuttering Performance

There is a feeling among many analysts that the manufacturing sector in India has not done well as in other countries, particularly China. The sector accounts for a relatively small share of GDP in India, and, furthermore, this share has been relatively stagnant over the past four decades or more. It is believed that growth in India has been based on growth of the services sector. The Indian government is making considerable efforts to raise the growth rate of the manufacturing sector and raise its share in GDP. A more dynamic manufacturing sector is seen to be particularly necessary to provide jobs for the emerging bulge in the youth population. Assessing the performance of India’s manufacturing sector is difficult because it depends on the perspective from which it is viewed. This brief assesses the performance of the manufacturing sector in India in the context of the world economy. We first examine the overall performance of developing economies. We then analyse the behaviour of the manufacturing sector in other developing countries, particularly the BRICS countries. We thus analyse the performance of the manufacturing sector in India in the context of overall macro trends in the world economy and the particular behaviour of the manufacturing sector. We then seek measures that might improve the performance of the sector