India on course to fill manufacturing competitive gap with China

Discussion in 'Economy & Infrastructure' started by LETHALFORCE, Jun 25, 2010.

  1. LETHALFORCE

    LETHALFORCE Moderator Moderator

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    http://economictimes.indiatimes.com/Indicators/articleshow/6084173.cms

    India on course to fill manufacturing competitive gap with China


    NEW DELHI: India will significantly bridge the gap with China in manufacturing competitiveness over the next five years says a joint study by consulting firm Deloitte Touche Tohmatsu and US Council on Competitiveness.

    India was ranked second among a list of 26 nations from both developed and emerging in the 2010 Global Manufacturing Competitiveness Index. While China had an index score of 10, India was at 8.15 that is expected to move up to 9.01 in the next five years when China will be at the same level.

    “India with its strong growth rate is expected to gain a stronger foothold over the next five years,” said Kumar Kandaswami, manufacturing leader at Deloitte in India. The country’s strength in research and development, paired with engineering, software, and technology integration abilities, are viewed by global executives as a vital element of the talent-driven and innovative manufacturing enterprise of the 21st century, as per the report.

    Manufacturing executives increasingly view India as a place where they can design, develop and manufacture innovative products for sale in local as well as in global markets. “These factors explain, in part, India’s rise from a low-cost, “back office” location to a country that is well-positioned to be an active participant in the entire value chain—as well as it now being viewed by many executives as an integral part of their global manufacturing enterprise and location strategy,” said the report.

    Korea, US, Brazil, Japan, Mexico, Germany, Singapore and Poland are the other economies that square up the top ten countries in the index, that is based on responses of senior management executives from companies across the globe and captured the drivers to manufacturing competitiveness. The report says Thailand will enter the top ten nations in terms of manufacturing competitiveness in the next five years.
     
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  3. LETHALFORCE

    LETHALFORCE Moderator Moderator

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    http://www.hindustantimes.com/India-is-No-2-in-manufacturing-competitiveness/Article1-562704.aspx

    India is No. 2 in manufacturing competitiveness




    India has emerged as the number two in the world in global manufacturing competitiveness, next only to China and ahead of economic superpowers like the US, Japan and Germany, according to a report from research firm Deloitte and US Council on Competitiveness.

    Based on responses of more than 400 senior manufacturing executives worldwide, the study also predicted that Asian economies will continue to be more competitive while US and Europe will find the going tough in the next five years.

    “India is now well positioned to become an active participant in the entire value chain. The presence of strong foundation in research and development along with the fact that India is now viewed as a place where product development can be done, not just for the local market, but for the international market as well, are the driving forces behind India’s strong position” said Kumar Kandaswami, Manufacturing Industry Leader for Deloitte in India.
     
  4. amoy

    amoy Senior Member Senior Member

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    Singapore and Poland - surprising to show in the ranks in manufacturing competitiveness
     
  5. Yusuf

    Yusuf GUARDIAN Administrator

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    Poland I think has a manufacturing culture, not sure about singapore though.
     
  6. BunBunCake

    BunBunCake Regular Member

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    Singapore makes those tasty chapatis that I buy in Indian stores here!!
    They are amazing! (Maybe LF tried them before :D)
    (be warned, they are not healthy)
     
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  7. Armand2REP

    Armand2REP CHINI EXPERT Veteran Member

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    The rankings are quite odd as to some of the countries on it.

    [​IMG]
     
  8. SHASH2K2

    SHASH2K2 New Member

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    I think It involve total cost involved along with technical expertise. having abundant and cheap labour force may help India.
     
  9. LETHALFORCE

    LETHALFORCE Moderator Moderator

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    PMI rises in India, falls in China

    http://www.business-standard.com/india/news/pmi-rises-in-india-falls-in-china/403341/
    While there are signals of industrial activity picking up in India, the output growth in China, often referred to as the world’s factory, is expected to slow.

    India’s manufacturing growth, as measured by the HSBC Purchasing Managers’ Index (PMI), accelerated to 57.6 in July, as against a deceleration in the previous month. The faster growth in July was the result of a sharp increase in output. The index had reached a 26-month high of 59 in May but had slipped to 57.3 in June, as pricing pressures dampened the sentiment.

    In contrast, for the first time since March 2009, China’s PMI shrank in July. Chinese manufacturing is expected to shrink as the PMI slid to 49.4 in July from 50.4 in June, mainly on account of government measures to slow down bank lending.

    “This is a culmination of a trend, as manufacturing growth in China had been slowing for a few months. The contractionary measures like rate hikes and some structural problems like wage escalation have come together and led to this,” said Abheek Barua, chief economist, HDFC Bank.

    China’s numbers came amid indications of growth in the euro zone, where strong growth in German manufacturing pushed up the index to 56.7 in July from 55.6 in June.

    The seasonally adjusted HSBC PMI is based on a survey of 500 companies. The index compiles a variety of factors such as output and employment growth, pricing pressures, order flow and delivery lags, among other indicators. A reading of over 50 indicates expansion.

    India Story
    The factory output index for India, which constitutes a part of the overall index, jumped to a four-month high of 62.3 in July from 60.5 in the previous month, pointing to a rate of expansion in production that was above the average growth trend since March 2009.

    “India is on a roll. The economy was given another leg-up in July, as new orders continued to pour in. Even the export sector appears to be holding up well, despite worries over cooling demand abroad,” said Frederic Neumann, co-head of Asian Economics Research at HSBC, in a statement.

    The growth in new orders was primarily guided by domestic demand, even as export orders did see a significant increase.

    “In our view, domestic demand continues to remain strong. Other activity indicators, such as the January-March quarter GDP growth, June core wholesale inflation data, motor vehicle sales and credit growth continue to signal strength in domestic demand,” Goldman Sachs’ Pranjul Bhandari and Tushar Poddar said in a research note.

    HDFC’s Abheek Barua said a slowing of the global economy might adversely impact exports, holding back manufacturing growth. “In the second half, due to the statistical effect and more fundamental reasons like high cost of borrowing and slowdown in the global economy, the growth in Indian manufacturing will be softer than in the first half,” he added.

    Jobs, pricing concerns
    However, even as output levels increased, job levels remained stagnant across India’s manufacturing sector during July. While new workers were taken on, there were complaints from firms of difficulties in sourcing skilled labour.

    “Employment, to be sure, has dipped a little in July, but if recent trends persist, this should prove to be a blip, rather than a more fundamental deterioration in the labour market,” added Neumann.

    New business growth was primarily driven by domestic orders, even as export orders did show significant increase in the past two months.

    Pricing pressures had dipped in the index last month. These continued to be a major concern for Indian manufacturers, despite a series of interest rate rises by the Reserve Bank of India. Both input and output price inflation gained pace during the latest survey period. However, the pressures were weaker as compared to those prevailing in the same period a year before.

    Indian manufacturers were also dogged by power outages during the month, as repeated power cuts led to an increase in pending business.

    Global stock markets rose on Monday, viewing a declining Chinese manufacturing PMI as the signal of a desired slowdown. Besides, they cheered the possibility of higher than expected growth in Europe, which has been the midst of a sovereign debt problem. Crude oil prices also rose to their highest level in almost three months.

    In India, the Bombay Stock Exchange’s benchmark index, the Sensex, rose by over 1 per cent, or 213 points, to close at 18,081. The rise in share prices and the bullish outlook also spurred inflows from foreign institutional investors, resulting in the rupee touching a five-week high against the dollar. It ended at 46.23 a dollar, as against 46.40 on Friday.
     
  10. LETHALFORCE

    LETHALFORCE Moderator Moderator

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    http://www1.voanews.com/english/new...Accelerates-in-India-Euro-Zone--99764469.html

    Manufacturing Cools in US, China; Accelerates in India, Euro-Zone

    Global surveys of manufacturers show factory activity has cooled in the United States and China, while growth has accelerated in India and the 16-nation euro-zone.

    The U.S. Institute for Supply Management says its manufacturing index fell to 55.5 in July from 56.2 in June. A reading above 50 means factory output is growing, while a sub-50 reading signals contraction.

    It is the 12th consecutive month of growth for U.S. manufacturers, but the pace of that growth has declined for the past three months. July's reading beat economists' forecasts of a slowdown to 54.1.

    Another survey of manufacturing companies in China found that factory production shrank in July for the first time in 16 months. London-based bank HSBC and financial services company Markit say China's purchasing managers index, or PMI, fell to 49.4 from 50.4 in June.

    HSBC and Markit say India's manufacturing sector performed better in July, with faster growth driven by new orders. India's PMI rose to 57.6 from 57.3 in June.

    A separate report shows manufacturing growth also accelerated last month in the 16-nation euro-zone, where Germany accounted for most of the increase. The Markit survey said the euro-zone's PMI rose to 56.7 in July from 55.6 in June.

    China's government has been trying to cool down industrial production to prevent the economy from overheating. It has tightened companies' access to credit and imposed limits on property speculation and investment in energy-intensive plants.

    China's statistics bureau published its own manufacturing index Sunday, showing a slowdown in growth to 51.2 in July from 52.1 in June.
     

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