Manufacturing sector Haryana - Factory sector

1. PRESENTED BY
Dr. Sudhanshu
Assistant Professor of Economics
Govt. College Tauru, Nuh
&
Dr. Laxmi Narayan
Assistant Professor of Economics
Govt. P.G. College Mahendergarh)
Registered Manufacturing Sector
and Haryana’s Industrial Growth
–Trends, Patterns and Comparisons

2. Objectives
 To appreciate the contribution of Haryana in
organised manufacturing of the country.
 To analyse changes in Haryana’s share in overall
registered manufacturing of the country.
 To understand the changes in pattern of registered
manufacturing in Haryana
 To understand the role of manufacturing in
Haryana’s economic development.

3. Methodology
 Secondary data - mainly from Annual Survey of
Industries.
 Annual growth rates - estimated using semi-
logarithmic function of the form Y= abt
.
 Structural ratio and technical coefficients were
computed and compared with all India average on two
different points to understand the change in these
parameters.
 Share of Haryana on various indicators of Organised
Manufacturing Sector was computed to know the
position of Haryana vis-a-vis other states.

4. Macro Level Growth Trends
Annual growth rates of Real NSDP
and Real Per Capita NSDP
Period NSDP Per Capita NSDP
Haryana India Haryana India
1971-02 to 1980-01 4.82* 3.66* 2.22* 1.23*
1981-02 to 1990-01 6.68* 5.60* 4.12* 3.36*
1991-02 to 2000-01 6.71* 6.03* 4.42* 4.07*
2001-02 to 2010-11 8.67* 7.45* 6.74* 5.64*
2011-12 to 2015-16 6.99* 6.20* 5.37* 4.18*
Note: * - Statistically significant at 5 per cent level.
Source: Calculated using CSO data and RBI Handbook.

5. Macro Level Growth Trends
0
100
200
300
400
500
600
700
800
900
1000
NDPIndices
Movement in NDP Indices
(1980-81 = 100)
Haryana
India

6. Annual Growth Rates - Components of Net
Domestic Product
Period
Agriculture Industry Services
Haryana India Haryana India Haryana India
1981-02
to 1990-01
3.37 2.95 15.08 7.34 7.49 6.46
1991-02
to 2000-01
4.07 3.33 8.37 7.37 8.38 7.63
2001-02
to 2010-11
3.27 3.32 9.05 7.54 12.07 9.15
2011-12
to 2014-15
2.84 3.37 4.59 6.9 8.07 6.5

7. 45.79
18.81
21.62
27.39
32.59
53.30
5
10
15
20
25
30
35
40
45
50
55
PercentageContribution Components of State Gross Domestic
Product-1980-81 to 2014-15
Agriculture & allied Industry Service

8. Share of Haryana in India’s Organised Manufacturing
Fixed
Capital
Value of
Plant
Total
Persons
Total
Output
GVA
shar
e
Rank
shar
e
Rank
shar
e
Ran
k
shar
e
Ran
k
shar
e
Ran
k
Maharasht
ra 13.6 2 13.7 2 19.5 1
16.
3 2
21.
4 1
Gujarat 17.7 1 10.5 3 10.9 3
18.
4 1
17.
4 2
Tamil Nadu 8.9 4 15.3 1 13.5 2
10.
2 3 9.0 3
Karnataka 6.8 5 7.0 4 7.8 4 6.7 4 5.9 4
Haryana 3.6 9 5.4 6 5.6 6 5.3 6 5.0 5
UP. 4.4 7 6.7 5 5.8 5 6.2 5 4.4 6
Uttarakhan
d 2.1 15 2.7 13 2.3 12 2.8 11 4.3 7

9. 1998-99 2014-15

shar
e

Rn
k
%
shar
e
Ran
k
Top state
(% share)
%
shar
e
Ra
nk
Top state
(% share)
NVA 3.8 9
MAH
(21.5)
5.0 5
MAH
(21.4)
1.3 4
Fix.
Cap 2.8 10
GUJ
(17.8) 3.6 9
GUJ
(17.7) 0.7 1
Inv.
Cap 3.3 9
GUJ
(16.3) 3.9
8 GUJ
(17.3) 0.6 1
T.Emp. 4.4 8
MAH
(16.2) 5.4
6 T.N.
(15.33) 1.0 2
T.Emol
. 4.7 8
MAH
(21.5) 5.6
6 MAH
(19.5) 0.9 2
Change in Haryana Contribution in the
Manufacturing Sector of India: 1998-99 and
2014-15

10. Number of Registered Working Factories and
Average Employment in Haryana
1966 1970 1975 1980 1985 1990 1995 2000 2005 2010 2014
No. of Fac. 1.2 1.4 1.8 3.2 4.5 4.8 6.5 8.6 9.3 10.5 11.3
Av. Emp. 60.8 65.3 61.3 55.1 50.5 55.6 60.2 57.8 61.9 74.4 75.3
40
45
50
55
60
65
70
75
80
0
2
4
6
8
10
12
EmploymentperFactory
No.ofWorkingFactories
(InThousands)

11. Annual growth rates in selected characteristics of
factory sector in Haryana vis-à-vis National Average -
1998-99 to 2014-15
Characteristics Haryana India Characteristics Haryana India
No. of
Factories 4.93 3.43
Prod. & by-
prod. 14.41 13.31
Fixed Capital 13.14 11.28 Depreciation 14.14 11.5
Working
Capital 12.85 12.27
Net Value
Added 14.05 11.71
Invested
Capital 12.88 11.45 Rent Paid 24.53 8.96
Out. Loans 10.79 9.9 Interest Paid 12.08 9.48
Fuels
Consumed 16.65 11.58 Net Income 15.19 13.05
Materials
Cons. 14.94 14.06 GCF 15.43 11.12

12. Structural Ratios for Factory Sector in
Haryana – 2001-02 and 2014-15
(Value figures in Rs. Lakh, Others in Number)
Structural Ratios
2001-02 2014-15
Haryan
a
All
India
Haryan
a
All
India
Fixed Capital per worker 6.51 6.43 12.64 8.32
Fixed Capital per Factory 314 304 586 590
Total Per. Engaged per F
actory 68 61 90 60
Workers per Factory 49 47 70 47
Gross Output per Factor
y 1004 706 2449 1642
Net Value Added per Fac
tory 125 109 325 232

13. Technical coefficients for Industries in
Factory Sector in Haryana and India – 2001-
02 and 2014-15
Technical Coefficients
2001-02 2014-15
Haryan
a
All
India
Haryan
a
All
India
Fixed Capital to NVA 2.51 2.78 1.80 2.54
Fixed Capital to Output 0.31 0.43 0.24 0.36
NVA to Output 0.12 0.15 0.13 0.14
GVA to Fixed Capital 0.51 0.45 0.67 0.47
Output to Input 1.19 1.24 1.19 1.20
Profit to Output 0.03 0.04 0.06 0.07
Source: Own calculation using data from ASI, 2001-02 and 2014-15.

14. Share of Major Industries on different Indicators
within Haryana
Maximum number of factories in Haryana are in the
manufacturing of Textiles (12.4 percent) followed by
manufacturing of fabricated metal (9.8 percent).
34.8 percent of fixed capital in Haryana was invested in
manufacture of motor vehicles, trailers and semi-
trailers. Manufacture of Basic Metals constitute 6.8
percent of fixed capital.
Manufacture of motor vehicles, trailers and semi-
trailers contribute 19.73 percent of Gross value added
for factory sector in Haryana and Agriculture and forestry
contribute another 10.3 percent.

15. Summing Up
Industrial sector has been an important component of
impressive growth rates in comparison to national
average. The share of Industries in Haryana SGDP is
much higher in Haryana as compared to national average.
Given its size and population, Haryana occupies an
important place at the national level. It occupies 5th
position in terms of NVA and 6th position in term of total
organised industry output.
More importantly the share of Haryana on various
indicators has shown upward trend. Its share in NVA of
registered manufacturing has increased by 1.25
percent for the period 1998-99 to 2014-15.

16. The factory output of the state is concentrated in few
sectors such as motor vehicles, trailers and semi-trailers,
basic metals, food products and other transport
equipments. Also the industries in Haryana are
concentrated in few districts.
In spite of making good progress in industrial
development, its performance on many structural and
technical coefficients has been inferior to national
average. Low output to input ratio for Haryana is an
indicator that industrial growth in Haryana has been
mostly input driven.
Summing Up

17.  The state should strive for deep and wide
industrialisation following the examples of
Maharashtra and Gujarat.
 The state should diversify its industrial base by
creating clusters of excellence in other industries
also.
 The location dispersion must be ensured by
identifying lagging areas, exploring industrial
avenues in these areas and providing fiscal and
financial incentives to the entrepreneurs.
 Special emphasis may be put for establishment
of small scale industries in these areas. The state
should ensure the availability of industrial
Summing Up

18. 18