Chapter 1 – Section 2
The world is divided!!
China did overtake us due to their policies benefitting business growth and the governments push for self reliance and exports. This push helped them also to develop indigenous equipment which were then sold to third world countries at competitive pricing. The advantage for china has always been that the institutes helped the industries with the technology development and hence the manufacturing units didn’t have to spend on R&D and design development.
This was the reason that they were able to build huge factories to cater global requirement. Added to this the labour laws ensuring higher productivity and workmanship helped the cause for china.
India on the other hand was just about treating its bruises post-independence when the government policies and education systems made sure entrepreneurship was killed and public sector companies were given more thrust. This slowed down progress as private businesses ran out of steam. This along with rise in corruption and Babuism made sure that India could not grow to support the global demand and instead remained just the manufacturing hub and importing for most of the needs.
The Second industrial revolution gave birth to Middle class in India which was larger in numbers. Also the need for manufacturing expertise and higher manpower ensured that literacy improved.
The Third revolution in 1969 was all about reducing dependency on humans to increase the efficiency of manufacturing Processes by implementing automation. The advent of computer and automation ruled the industrial scene. It was during this period of transformation era where more and more robots were used in to the processes to perform the tasks which were performed by humans. This increased the investment cost and hence economies of scale increased with the necessity to manufacture higher volumes.
The takeover of assemblies and other packaging by automation reduced the manpower intervention in those areas.
The Industry 3.0 also saw an increase in manpower and manufacturing costs in the developed nations, which saw the rise of China which utilised the combination of its huge manpower resource and technology to reduce manufacturing costs and slowly become the hub for the world.
As per The Transformation and Upgrading of the Chinese Manufacturing Industry: Based on “German Industry 4.0” a report published by Jianghan University China and Niagara University, China’s manufacturing industry output accounted for 2.7 percent of the worldwide output and was ranked the ninth in the world. In 2000 it rose to 6.0 percent and ranked the fourth in the world. In 2007 it reached 13.2 percent with a rank of second in the world. By 2010 it was 19.8 percent with the number one ranking in the world (Figure 1)
China’s R&D funding into Technology development also rose during this period. According to statistics, the proportion of basic research is less than 5 percent in China. Instead they diverted their funding in importing Technology from Developed nations and clone them to provide cheaper solutions. This helped many developing nations due to the necessity of low cost equipment.
India, on the other hand did not invest in R&D and the politics with corruption made sure that our dependence on developed nations for technology remained. Also In India only large companies adopted Industrial automation. In that respect, we were still in Industry 2.0 when the world moved to Industry 3.0. Only in the recent decades, due to the stability of our Government, we have been able to take bold decisions on privatisation and development of MSMEs.
This article is the second part of our first post. To read that, you can visit https://navaritie.in/2020/05/25/heres-why-we-cant-generalise-usage-of-3d-printers-globally/