Page 224 - DECO303_INDIAN_ECONOMY_ENGLISH

Unit 13: Small Scale Industrial Sector in India

of Punjab, 2010). In terms of location small scale industrial groups emphasise in various districts Notes
as, hosiery and garment units are in Ludhiana, basic metal product industry in Mandi Gobindgarh,
Batala, Ludhiana, Jalandhar and Amritsar, and textile units in Ludhiana, Amritsar and Dera
Bassi. Moreover, several industrial groups involving food products, chemical products, leather
products, metal products and machinery, etc. are extensive in the state. Ludhiana leads in
Industrialisation and produce 28% of the total industrial output of Punjab and having highest
number (166) of large and medium scale units. Amritsar and Jalandhar were traditionally more
advanced, whereas, Sangrur was announced as centrally backward district. The major small
scale industry in Punjab is hosiery industry, which contributes 91% of the total hosiery goods
manufactured in India, 10% of the total production and 48% of total employment of small scale
industrial sector in Punjab, whereas, it offers employment to 54 thousand persons. Table 13.1
above shows the district-wise distribution and concentration of industries in Punjab.
Punjab and Haryana are agrarian states and contribute 40% of the total agriculture production in
India. About 75% of the total population of these states directly or indirectly relies on agriculture
for their livelihood. Punjab and Haryana are self-sufficient in food production and led the
nation’s Green Revolution in the 1960s; Punjab received the title of India’s ‘bread basket’. Both
states have done remarkably well in the field of agriculture and are now well on their way to
rapid industrialisation through the coordinated development of small, medium and large scale
industries. Both states have mostly small-scale industry due to the unconquerable spirit and
entrepreneurial skills of their peoples.
It is important for you to understand that in Punjab, the number of small scale industrial units is
191,639, whereas there are 340 medium and large scale industries including fixed capital
investment of ` 5502.94 crore and ` 23285.58 crore, respectively. The industries employ
approximately 938,684 workers in comparison with 199,342 people in the medium and large
scale industrial sector.

Investment Overview

The state has more than 204,000 small and medium enterprises and about 600 large scale
companies. It is one of the leaders in the production of printing and paper cutting machinery;
machine and hand tools; auto parts and electrical switch gear. It offers more than 75% of the
nation’s requirement for sewing machines, bicycles, hosiery and sports goods. Punjab has 273
Mega Industrial Manufacturing, Multiplex, Industrial Park and Hotel Projects with proposed
investment of ` 61466.12 crore which have been sanctioned by State Government for
implementation during 2007-08 (31 December 2007). The Empowered Committee has sanctioned
13 more new Mega Projects with an investment of ` 1307.54 crore in 2009.

Economic Overview

Punjab which has done extraordinarily well in the field of agriculture is now well on its way to
rapid industrialisation through coordinated development of small, medium and large scale
industries. The share of primary sector including agriculture and livestock has risen sharply
from 1.7% in 2005-06 to 5.08% in 2008-09. The growth of the secondary sector has declined from
7.6% in 2005-06 to 6.5% in 2008-09. The growth of tertiary sector, which consists of services sector
along with trade, transport, banking and insurance and public administration, has risen from
4.5% in 2005-06 to 6.95% in 2008-09. This growth is primarily due to rise in contribution from
banking, storage and insurance and pharma sectors.
Cumulative FDI in Punjab region for the year ended March 2009 is US$384mn. The region
explains for 0.42% of overall FDI received.

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