India holds the potential to become a global manufacturing hub if it integrates technology with its industrial operations, according to a paper by foreign policy think-tank Gateway House. As the global trade scene is shifting from China, this is an opportunity for India to take the benefits and emerge as a new supply chain partner, it said.
What is digital manufacturing?
Digital manufacturing is a part of the larger wave of Industry 4.0, integration of industrial processes with the Internet of Things (IoT) and couples with IT systems like artificial intelligence, and virtual reality to monitor the entire production line through sensors in real-time. Michael Mandel, the chief economist at the Progressive Policy Institute, says, “The world has been focusing on the razzmatazz of technology, old-fashioned manufacturing is going through an exciting transition. We are moving from a linear supply-chain world to a much more adaptable Internet of Goods with a new manufacturing stack akin to the Internet stack.” Currently, Tata Steel in Kalinganagar, Orissa is the forerunner in this process, being one of the 44 global elite facilities on the World Economic Forum’s Lighthouse Network of Companies that have digitized their manufacturing processes successfully. Other multinationals and start-ups in the country are also looking for an opportunity to combine these processes in their industrial operations.
India needs to go beyond industry 4.0
The executive director of Gateway House, Manjeet Kriplani, said, “India needs to look at digital manufacturing and go beyond industry 4.0 – it needs accelerated manufacturing, but needs to create jobs as well. She also said that Indian software firms and startups could play an important role in helping domestic companies make this transition.
Rajan Navani, managing director, Jetline Group believes that this can be a great opportunity for India, but things are moving slowly because of the COVID-19 pandemic. He said, “We are a source of tech talent to the world and can make the most of this opportunity. But the Indian industry needs to invest much more than what they currently are.”
Advantages from the foreign markets
In July, the Japanese government put aside $500 million to pay companies to move their manufacturing operations from China. Japan and the United States are already looking for partners to completely move out, primarily on security concerns. Similarly, Chizel, a startup providing manufacturing services, has seen sharp spikes in international inquiries. The founder of Chizel, Yash Rane, says, “There is demand from European and Australian companies that were earlier sourcing parts from China. These are mainly heavy engineering companies and equipment manufacturers.” A recent study by Cloud firm Digital Ocean also shows that digital services by SMEs in India far outpace the demand in the United States. Overall, all the projections are favourable for India if it can adopt wider digital manufacturing practices.
What Indian Government needs to adopt-
- The government is also providing assistance to such ideas and is encouraging the establishment of start-ups, especially in IoT. India still lacks the hardware support for becoming a fully-developed digital manufacturing sector, like, 3-D printers, sensors and most importantly, cloud infrastructure.
- Government-approved bodies need to incorporate various certifications in these fields for a product or process certification equivalent to those issued by ISO (International Organization of Standardisation), DIN Standards (Deutsche Institut fur Normung) or ASTM (American Society for Testing and Materials).
- Education of the current employees to rightly manage the association of technology with manufacturing is also necessary.