India witnesses’ improvement in manufacturing sector

By OEM Update Editorial September 1, 2021 8:14 pm IST

Industry experts across manufacturing sectors believe that the incorporation of software and automated technologies for factory operations and safety of the workers will enhance production capacities.

Covid-19 pandemic has disrupted every sector. Organisations which are serving technology, healthcare have experienced a surge in demand while those that manufacture tools for aviation, energy, and the automotive industry have experienced a slowdown. Manufacturing industry is the hardest hit segment due to Covid-19. India’s manufacturing sector output shrunk by 20 percent in the first quarter of 2020. Last year, the lockdown and restrictions completely halted manufacturing and derailed the global supply chain. The manufacturing sectors facing major disruptions in the areas of standard manufacturing processes i.e., production, demand, and supply chains. However, there are some sectors like pharma and healthcare that witnessed major manufacturing demand and therefore growth.

The impact of Covid-19 on the global manufacturing industry into distinct manufacturing i.e., machinery, automobile, electrical and electronics, metal, aviation, etc., and process manufacturing sector includes chemicals, pharmaceutical, F&B and medical equipment, personal care& cosmetics, etc.

Component manufacturing Sector

The hardest hit sector in the manufacturing industry is component manufacturing. Due to pandemic, the factories and production operations of automotive, electronics, aerospace, and others, got shut. China, the hub for the supply of raw materials to produce all the industrial tools, impacted due to Covid. It also impacted the whole supply chain in the entire world, resultantly, manufacturing plants halted and derailed the supply chain of several companies.

Food & Beverage manufacturing sector

In the given scenario, food & beverage manufacturing companies are facing considerably reduced consumption as well as supply chain problems. The supply of ingredients and raw materials to the manufacturing sites has been affected badly which resulted into hampered production, forcing manufacturers to abstain from operations. According to French Trade Group, it has been noticed that Food and Beverage industry have suffered 22 percent loss in turnover globally.

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Every industry segment has been affected by the pandemic and the globally integrated automotive sector is no different. Factory disclosures, supply chain disruption, and declining demand have all taken rise. Due to Covid, the industry almost had been at standstill.

Pharma Manufacturing Sector

India and other countries that are under medical device and manufacturing rely largely on sourcing material directly or indirectly from China. Now, with the limited operational capacity in China, they faced supply shortages. Pharma sector has suffered tremendously due to heavy outbreak of pandemic. However, it brought opportunities for some of the pharmaceutical companies to come forward and start trials and produce vaccines. India has established itself as leading manufacturer in the pharmaceutical sector. Many pharma and other industrial tools manufacturing companies started producing masks, ventilators, oxygen manufacturing and other related products and equipment. Medical sector must follow innovation and need to review the business processes to survive Covid.

The silver lining remains in the fact that the pandemic has urged businesses to build resilience and the government has opened many avenues for manufacturing to gain momentum with a view to restore economic progress.

Opportunities that lie ahead

India witnessed improvement in the manufacturing sector since October 2020. Companies are investing a lot into R&D and innovation to be prepared for the future demand. The pandemic has shifted focus from global to local. Manufacturers are leveraging automation and digital technologies to foster growth. However, there is a need for manufacturers to revisit their sourcing strategies and alternate suppliers. This will create future opportunities for manufacturers. Industries like healthcare and pharma that have gain prominence will see further growth as demand for medical consumables and personal medical equipment is likely to grow.

Overall, industry experts across manufacturing sectors believe that the incorporation of software and automated technologies for factory operations and safety of the workers will enhance production capacities of companies in future.