Performance and dynamics of manufacturing industries in Punjab

Liberalization regime in India has failed to produce anticipated results in terms of industrialization and remained ineffective in providing any concrete solution to the large scale unemployment in the economy. Whatsoever industrial investment has taken place has only been in the industrially advanced states thereby intensifying the problem of interstate industrial disparities. At this juncture, robust and balanced industrial development is seen as a catalyst to transform the institutional set up of the economy leading to socioeconomic development of the masses. Industrialization assumes greater importance for a state like Punjab wherein agriculture has already reached a plateau and a new model of development that is industrial centric in nature is sought. It is against this backdrop that an economic analysis of the manufacturing industries in Punjab is carried out. Results demonstrated that a significant association between gross value added and gross fixed capital signifies that an increase in capital stock can lead to an increase in value addition. Overall low capacity utilization in manufacturing sector as a whole yielded a good scope for increasing value addition by utilizing entire capacity.