Indian manufacturers are recognizing the transformative potential of technology in boosting profitability and competitiveness. However, a recent report by the Confederation of Indian Industry (CII) reveals that most manufacturers currently allocate less than 10% of their budgets to technology adoption.
A Shift Towards Greater Investment in Technology
The CII Manufacturing Competitiveness Study predicts a positive shift in budget allocations for technology adoption. Over the next two years, investments are expected to rise to 11-15% of budgets, with a strong focus on advanced technologies such as the Internet of Things (IoT), Robotics, and Big Data. These technologies are anticipated to enhance operational efficiency, drive innovation, and ensure global competitiveness.
Challenges Hindering Technology Adoption
Despite the enthusiasm, manufacturers face several challenges, including:
- High Costs: Many businesses, particularly small and medium enterprises (SMEs), find the upfront costs prohibitive.
- Uncertain ROI: The return on investment from advanced technologies often remains unclear, deterring higher spending.
- Legacy System Integration: Older systems present compatibility issues when integrating modern technologies.
The report emphasizes the importance of addressing these barriers to enable a smoother transition to smart manufacturing.
The Need for Workforce Upskilling
Another critical challenge is the skills gap. As manufacturers adopt advanced technologies, there is an urgent need for workforce upskilling to ensure seamless implementation and operation of new systems. Training programs and collaborations with academic institutions are recommended to bridge this gap.
Smart Manufacturing: Unlocking India’s Potential
Titled “Smart Manufacturing: Unlocking India’s Potential,” the CII report highlights how advanced technologies are reshaping the manufacturing sector. High-capital industries such as Semiconductors, Aerospace, and Automotive are leading the charge, while traditional sectors like Textiles and Food Processing are gradually embracing digital transformation.
Recommendations for Accelerating Adoption
The report provides actionable recommendations to foster technology adoption, including:
- Public-Private Partnerships: Establishing shared technology hubs for cost-effective access to resources.
- Increased Budget Allocations: Encouraging manufacturers to dedicate a larger share of their budgets to technology.
- Industry-Academia Collaboration: Strengthening ties between academia and industry to drive innovation and skill development.
- Supportive Policies: Implementing government policies that incentivize smart manufacturing practices.
Insights from Industry Leaders
Deepak Shetty, Chairman of the Council on Manufacturing Excellence at CII and CEO & Managing Director of JCB India Limited, stated, “India’s manufacturing landscape is undergoing a significant transformation, driven by the rapid adoption of innovative technologies.”
Deepak Jain, Co-Chair of the Council on Manufacturing Excellence at CII and Chairman of Lumax Group, added, “This report highlights a transformative moment for India’s manufacturing sector, where advanced technologies are reshaping processes and addressing challenges like supply chain visibility to drive industrial excellence.”
Conclusion
India’s manufacturing sector stands at a pivotal juncture, where strategic investments in advanced technologies can unlock immense potential. By addressing barriers, upskilling the workforce, and fostering collaboration, the industry can achieve its ambitious goal of increasing its GDP share to 25% in the near future.