A government survey reported by The Economic Times shows India's manufacturing output is highly concentrated: factories producing above Rs 500 crore made up about 3.6% of operational plants but generated 62.07% of total output and nearly 61% of net value added in FY25. At the other end, units with output up to Rs 10 crore were 52.36% of plants but contributed just 1.92% of output. Capital-heavy units with plant and machinery of Rs 10 crore or more held 87.42% of fixed capital and produced 76.82% of output. The manufacturing corporate sector recorded 9.28% year-on-year GVA growth, while GVA per person engaged rose only 2.25%.
India’s manufacturing base is heavily concentrated in a small group of large plants, according to a government survey reported by The Economic Times. Factories producing more than Rs 500 crore in output made up about 3.6% of the country’s operational plants but generated 62.07% of total manufacturing output and nearly 61% of net value added in FY25.
Large plants dominate output and jobs
The findings come from the Annual Survey of Industries (ASI) conducted by the statistics ministry. Beyond their share of production, these large factories also provided employment to about a third of the total workforce engaged by the sector during the year.
At the other end of the scale, factories with annual output of up to Rs 10 crore represented 52.36% of operational units but contributed just 1.92% of total output and 2.12% of net value added. The detailed report follows the release of the ASI 2024-25 factsheet in September.
Capital investment shows a similar divide
Classifying factories by the size of their capital reinforces the pattern. Units with plant and machinery valued at Rs 10 crore and above accounted for 15.84% of operational factories in FY25, yet they contributed 76.82% of total output and 78.07% of net value added.
These same capital-heavy units held 87.42% of the fixed capital deployed in the registered manufacturing sector and engaged 59.66% of all persons employed. By contrast, factories with investment of up to Rs 5 crore made up 78.69% of operational units and employed 34.32% of the workforce, but contributed only 19.24% of total output and 17.61% of net value added.
Value added rises faster than per-worker gains
The manufacturing corporate sector, which accounts for more than 89% of total manufacturing gross value added (GVA), posted a 9.28% year-on-year increase in GVA in FY25. The gross value of plant and machinery in the registered manufacturing sector rose 7.25%, while net value added per operating factory increased 6.59%.
Those gains did not carry through evenly to individual workers. GVA per person engaged grew 2.25% during the year, even as the number of persons engaged in the manufacturing corporate sector rose 7.57% and the number of operating factories in the segment increased 3.45%.
Employment and output cluster by industry and state
Employment is likewise concentrated in a handful of industries. Food products, textiles, basic metals, motor vehicles and wearing apparel together accounted for more than 41% of total manufacturing employment in FY25.
At the state level, Maharashtra, Gujarat, Tamil Nadu, Karnataka and Uttar Pradesh together contributed more than 54% of the country’s manufacturing GVA, according to the survey.
Source: m.economictimes.com
Compiled from international media by the SCI.AI editorial team.
