The National Association of Software and Services Companies (NASSCOM), in collaboration with Capgemini, announced the findings of a research study on the adoption of Industry 4.0 in India’s manufacturing sector. Titled, ‘India Industry 4.0 Adoption: A Case to Mature Manufacturing Digitalization by 2025’, the report sheds light on the maturity of digitalized manufacturing in India, and recommends a focus on increasing investments, scaling up foundational technology readiness, and enhancing capabilities. These recommendations, cites the report, will help facilitate globally connected smart factories that will enable India’s manufacturing sector to become an intelligent industry and achieve the national growth target of $1.1tn by FY26.
From comprising 5% of manufacturing IT spend in 2011, to 20% by 2021, Industry 4.0 has witnessed over a decade of transition since 2011. It has also grown by 9.6 times during the same period, from $10.5 billion in 2011 to $103 billion in 2021, driven by business growth, resilience and sustainability needs.
According to the report, investments in Industry 4.0 have grown by approximately 10X in the last decade and are expected to grow to $200+ bn by 2025. Countries such as US, UK, China, India and Brazil are expected to supplement this with new investments, amounting to a total of $100+ bn.
Sharing her thoughts, Debjani Ghosh, President, NASSOM, said, “Industry 4.0 has reached a tipping point in Indian manufacturing, with a strong desire to boost investments in the next two years to create exceptional customer experiences and long-term business models. Moving forward, it will be fascinating to watch how ready the Indian manufacturing industry is to adopt and scale Industry 4.0, which is largely determined by the use cases selected, the capacity to scale Proofs of Concept, and the alignment of IT and OT capabilities.”
Commenting on the potential of Industry 4.0 to build interconnected factories of the future, Ananth Chandramouli, Managing Director and Head of the India Business Unit, Capgemini, added: “Enterprises will begin to concentrate on new business models, and on understanding the needs of end customers so that they can innovate new products and become truly intelligent. In India, we have seen that manufacturers are talking about holistic digital transformation.”
With accelerated investment in foundational tech like Cloud and IoT, the Indian manufacturing sector has started pivoting to digitalization, cites the report, with $5.5 – $6.5 billion spent on Industry 4.0 in FY21.MSMEs (Micro, Small and Medium Enterprises) in India account for 33% of the manufacturing output and 45-50% of exports, across textile, food processing, chemical, and electrical or equipment.
The report concludes that Industry 4.0 is at an inflection point in Indian manufacturing. There’s an urgent need to increase investments in the next 2 years and drive a rapid shift from proof-of-concept to a more ROI driven, outcome-based deployment.
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