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08

Industry and Infrastructure

CHAPTER

Global Industrial activity continued to be affected by the disruptions caused by the
COVID-19 pandemic. While the Indian industry was no exception to these disruptions
,its performance has improved in 2021-22. Gradual unlocking of the economy, record
vaccinations, improvement in consumer demand, continued policy support towards
industries by the government in the form of AtmaNirbhar Bharat Abhiyan and further
reinforcements in 2021-22 have led to an upturn in the performance of the industrial
sector. The growth of the industrial sector, in the first half of 2021-22, was 22.9 percent
vis a vis the corresponding period of 2020-21and is expected to grow by 11.8 percent
in this financial year. The industrial performance has shown improvement as reflected
in the cumulative growth of the IIP. During April-November 2021-22 the IIP grew at
17.4 percent as compared to (-)15.3 percent in April-November 2020-21. According to
RBI- Studies on Corporate Performance, which is based on the results of select listed
companies in the private corporate sector, the net profit to sales ratio of large corporates
reached an all-time high despite the pandemic. Buoyant FDI inflows amid improvements
in overall business sentiments, foretells a positive outlook for the industry.

The introduction of the production linked incentive scheme (PLI) to encourage scaling up
of industries and major boost provided to infrastructure-both physical as well as digital–
combined with continued measures to reduce transaction costs and improve ease of doing
business, would support the pace of recovery. Several initiatives such as the National
Infrastructure Pipeline (NIP), National Monetization Plan (NMP), amongst others, have
been taken to propel the infrastructure investment. Capital expenditure for the Indian
Railways has been substantially increased from an average annual of Rs. 45,980 crores
during 2009-14 to Rs. 155,181 crores in 2020-21 and it has been budgeted to further increase
to Rs. 215,058 crores in 2021-22. This implies five times increase in comparison to the 2014
level. In addition, the extent of road construction per day increased substantially in 2020-21
to 36.5 kms per day from 28 kms per day in 2019-20, a rise by 30.4 percent as compared
to the previous year. The Government has also heralded a major boost to the electronics
hardware sector and brought in structural and procedural reforms in the telecom sector.

INTRODUCTION

8.1 COVID-19 pandemic led to disruptions in global economic activity impacting not only
the lives but also livelihoods. The Indian industry experienced interlude in business activity
leading to slowdown in its performance. With the gradual unlocking of the country coupled