Indian Manufacturing Industry
India’s manufacturing sector is on a high growth trajectory. As targeted by the National Manufacturing Competitiveness Council (NMCC), it is set to contribute 25% to the GDP by 2025 compared to the current share of nearly 16 %. Notably, the sector contributed 66% to the nation’s exports and has been strengthening at CAGR of 20% in the last five years.
The competitiveness that the sector commands in the global arena is driving its growth. India ranks second in the world as per the 2010 Global Manufacturing Competitiveness Index (GMCI) prepared by the US Council on Competitiveness, and Deloitte. As per the same source, India would maintain its second ranked and continue to dominate the global manufacturing even after 5 years. India has set benchmarks in the international market with respect to quality in manufacturing. The country is currently second only to Japan in hosting companies awarded for quality excellence.
The India advantage is favouring growth in the sector as international players such as Hyundai, Nokia, Samsung and Airbus are focussing on setting up manufacturing facilities in the country. Interestingly, India’s growth in the manufacturing sector overshadows other BRIC members. This can be associated to the strength in the Indian Domestic market.
In a major boost to the 'Make in India' initiative, the Government has received confirmation from top technology firms such as GE, Bosch, Tejas and Panasonic regarding their decision to invest in the electronic, medical, automotive and telecom manufacturing clusters in India. "We have received 57 investment proposals of over Rs 19,000 crore (US$ 3.05 billion) of which 30 proposals worth Rs 6,500 crore (US$ 1.04 billion) have been approved," said Mr Ravi Shankar Prasad, Union Minister for Communications and Information Technology, Government of India.
In a bid to push the 'Make in India' initiative to the global level, Mr Narendra Modi, Prime Minister of India, plans to pitch India as a manufacturing destination at the World International Fair in Germany's Hannover. Mr Modi is likely to showcase India as a business friendly destination to attract foreign businesses to invest and manufacture in the country.
Key market drivers for the Indian Manufacturing Industry:
• The Indian manufacturing sector has been witnessing a sluggish growth due to deceleration in investment.
• The national manufacturing policy suggests raising the share of manufacturing in GDP to 25% in order to create 100 million jobs in the coming decades.
• Additional capacities are being planned to be installed in all the major manufacturing units.
• A public procurement policy has been proposed incorporating technology along with common facility centres while the Khadi Mark steps has been launched to promote Micro Small and Medium Enterprises.
Around 90 million domestic jobs are waiting to be created by that timeframe with the manufacturing segment contributing about 25-30% of India’s gross domestic product. India’s rapidly expanding economy is giving both international entrepreneurs and home players an array of opportunities to venture out and grow. (www.shine.com) (www.mckinsey.com) (www.ibef.com)

Figure 1: Use - based division of Indian manufacturing sector

(www.ibef.com)

Employment Trends
India’s manufacturing sector is vital for its economic progress. The government has realised the importance of this sector to the country’s industrial development, and has taken a number of steps to further enhance the industry. Today, the country’s attractiveness as a manufacturing centre for foreign companies is clear.
Despite deceleration in performance in the past few years, the Indian manufacturing industry is now getting back on track to create 3.2 million work opportunities during the 12th Plan period (2012-2017), according to a study by ASSOCHAM.
The report found that the sector clocked 28.5% growth in employment generation during the 11th plan (2007-12). "An additional 2.9 million jobs were generated in the registered manufacturing sector during 2007-08 to 2011-12 from over 10.45 million jobs in 2007-08," the ASSHOCAM Report said.
Tamil Nadu among all the states is topping the chart with as high as 14.5% share in total jobs generated by registered manufacturing sector across India, with Maharashtra leading the second position with 14% and Gujarat with 10% shares respectively. Meanwhile, Chhattisgarh (19%), Uttar Pradesh (15%), Haryana (14%), Kerala (10.5%) and Punjab (9%) recorded the slowest growth rate in employment generation.
The report further says that the Indian manufacturing sector is going through a revival phase. With an improved economic performance, the sector may help in generating about 3.2 million additional manufacturing jobs by 2017. (www.shine.com)
Compensation trends
According to PayScale’s 2015 Compensation best practices Report - companies are becoming increasingly confident in their ability to thrive after a period of relative stagnation. In addition, the vast majority of companies expect their financial outlook to improve even more in 2015. The optimism was consistent across company size and within most industries, reflecting the importance of effective recruiting programs to keep pace with the anticipated growth for many companies.
Retention remains a top worry for the third year in a row, as employers feel challenged to keep top performers in an increasingly competitive talent market. Meanwhile, many employees quit their jobs and joined other companies in the pursuit of higher compensation. Finally, employers are struggling to fill positions—particularly for highly trained employees—as they cite a lack of qualified applicants.
Even with these challenges, compensation management remains more of a black art than a science at most organizations. Nearly a third of companies don’t regularly perform market and compensation analysis to understand the changing dynamics of their respective talent markets, many are dissatisfied with their data, and most do not train managers to have tough conversations with employees about compensation. The underlying tenet: companies need to become much more mindful about getting pay right if they expect to attract and retain the employees who are crucial to their business. (http://resources.payscale.com/)
Major Players
Though India is an ever growing manufacturing hub with a lot of players the reigning players of the Indian manufacturing sector are:
1. Aditya Birla Group
Business: Conglomerate
Employees: 136000+
Turnover: $40 billion
2. Larsen & Toubro
Business: Technology, Construction and Manufacturing
Employees: 45000+
Turnover: $13.5 billion
3. Bombay Dyeing
Business: Textile Manufacturing
Employees: 10000+
Turnover: $310 million
4. Hindustan Lever Network
Business: Consumer Goods
Employees: 40000+
Turnover: $4 billion
5. Haldia Petrochemicals Ltd.
Business: Petrochemicals
Employees: 1000+
Turnover: $2 billion
(http://top10companiesinindia.co.in) (Wikipedia, n.d.)
Globally though the top ranking manufacturing companies belong to countries like Japan, U.S and Germany and are dominated by the global automotive industry leaders. The following is a list of the top 10 world's largest manufacturing companies, ordered by revenue in millions of U.S. dollars according to the Fortune Global 500. Currently all companies with revenue greater than $25 billion are included:
• Toyota
• Volkswagen Group
• Samsung Electronics
• Daimler
• General Electric
• General Motors
• Ford
• Hewlett-Packard
• Hitachi
• Nissan
Only three Indian companies belonged to this list and they are:
• Tata Motors
• Tata Steel
• Tejas Networks
The Indian manufacturing sector have a lot of ground to catch compared to their global counterparts.