India has made progress in making its manufacturing sector extra engaging to world traders, and ongoing modifications in worldwide commerce coverage would profit India in the long term, a S&P International examine mentioned on Monday.
Analysis says, India’s manufacturing sector is extra engaging to world traders(Consultant picture/Bloomberg)
S&P International India Analysis Chapter’s examine, titled ‘India Ahead: Transformative Views’, mentioned that as economies adapt to evolving commerce dynamics and tariff challenges, India can capitalise on this momentum for accelerated manufacturing development and larger world supply-chain integration.
A strategic shift in direction of native sourcing, proximity to end-markets, and enhanced regional integration ought to appeal to extra funding to the sector, accelerating India’s technological development and manufacturing competitiveness and creating extra high-quality manufacturing jobs, it mentioned.
“Beyond the near-term, changes in global trade policy would catalyse supply-chain diversification, to the benefit of India,” it added.
The examine mentioned India has made “notable progress” in enhancing its competitiveness and making its manufacturing sector “more attractive to global investors”.
India stays the world’s fastest-growing massive economic system regardless of a slowdown in actual GDP development in fiscal 2024-25.
The S&P International examine mentioned India has average dependence on exterior commerce for development, which cushions it considerably from ongoing shifts in world commerce and tariff insurance policies, although it’s not resistant to the rising commerce protectionism.
Whereas manufacturing worth added accounts for a modest 17.2 per cent of the nation’s actual gross home product (GDP), the federal government has carried out focused coverage interventions to construct home manufacturing capability and strengthen India’s function in world provide chains.
“High-frequency HSBC Purchasing Managers’ Index (PMI) data … highlights the domestic manufacturing sector’s resilience to recent global headwinds compared with other major economies,” the examine famous.