Kerala is second only to Karnataka in terms of manufacturing excellence across the country, according to a study conducted by the apex industry body Assocham, which was released on Friday.
“Kerala has second highest ratio in terms of road density, third highest ratio in terms of efficiency and fourth highest capacity utilisation ratio denoting state’s performance in these parameters during the course of past five years, said the study titled ‘Manufacturing Excellence and Emergence in India: The state level analysis’.
Besides, Kerala also has recorded third lowest ratio in terms of employee cost and sixth highest manufacturing process ratio.
The study considered various parameters like number of factories, output value, working capital, net fixed capital formation, fixed capital, finished goods, capital invested, total inputs and others to ascertain the states’ performance in terms of manufacturing sector.
The study also pointed out that, Kerala needs to work towards improving its performance in areas like growth of industries (13th rank), capital structure (16th) i.e. improving the ratio between invested and fixed capital. Besides, the state also needs to register improvement in terms of brining down input cost as it ranks 16th in total input cost as a proportion of value of output (lower ratio is better).
“The central government must address issues relating to poor product quality, infrastructural bottlenecks and inadequate efforts at research and development from a holistic macro perspective as they have collectively taken a toll on India’s manufacturing competitiveness,” the study said.