GDP to get 25 percent contribution from manufacturing by 2025: KPMG
Manufacturing contributes over 80 percent to overall industrial production.<br /><br /> <br /><br />
Mumbai: The proposed national manufacturing policy (NMP) is likely to help increase the contribution of the sector to GDP from the current 16 percent to 25 percent by the turn of 2025-five years later than the government projection-a KPMG report said today.
"The proposed first national manufacturing policy will help create an eco-system that will enhance the country's GDP and global competitiveness of the manufacturing sector. This envisages increase in the contribution of the sector to GDP from the current 16 per cent to 25 percent by 2025," KPMG India Head of Advisory, Richard Rekhy, said in the report titled 'Global Manufacturing Outlook 2011'.
The government is working on a NMP that aims to attract overseas investments and increase the share of the sector in the economy as currently GDP is largely skewed towards services with over 65 percent contribution.
The Centre aims at raising the share of manufacturing sector from the present 16 to 25 percent of GDP by 2020 with the NMP.
Manufacturing contributes over 80 percent to overall industrial production.
Economists and experts have been pointing out that the services sector is not creating as many jobs as the nation, which has over 65 percent of its population under the age bracket of 30, wants. They also feel if the economy is to sustain higher growth rates in the long-term, the best way to achieve that is creating jobs in millions per annum by widening the manufacturing sector.
Though the NMP was to be cleared by the Cabinet last week, last minute differences on issues regarding relaxing environmental and labour laws held back notification of the much-awaited policy.