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May 7, 2018

Industry 4.0: India Approach


Manufacturing Industry in India has a potential to touch $1 Trillion by 2025 accounting for 25 to 30% of India's GDP, and create up to 90 Million jobs. With the Government focusing on 'Make in India', the manufacturing industry must seize the moment by investing in new technology and expanding its competitive advantage and capturing more of the global market.

With government focusing on Digital India initiatives,
time is ripe for Indian Manufacturing to transition to Industry 4.0 (I4.0). Also called 'Smart Manufacturing', I4.0 covers the interaction between man and man, man and machine and machine and machine. The technology facilitators are Industrial Internet of Things (IIOT), Cyber-physical systems (3D Printing, Rapid Prototyping etc) and Cloud Computing. This has the potential to bring about significant efficiencies across the entire supply and demand chain of the manufacturing industry.

This article starts of with a quick overview of I4.0. Then we look at potential of I4.0 in India, the challenges that are specific to the country, the ongoing policy initiatives. We wind up the article with a look at a few case studies of the use of I4.0 principles by the manufacturing industry in the country.

Check out this post for a Primar on I4.0

Evolution of Industry 4.0

Manufacturing Industry has gone through four phases. Industry 1.0 was characterised by the use of steam & water power and manual labour. The use of electricity and assembly lines to help mass production in manufacturing plants signalled the arrival of Industry 2.0. Starting from about '70s, the use of computers and CNC machines for precision manufacturing and automation of production heralded the arrival of Industry 3.0

With use of technology expanding rapidly, Big Data supporting sophisticated and complex analytics, IIoT helping interactions between man and machines and also between machines, Cloud Computing supporting huge data storage and fast retrieval of data and finally, new Cyber - physical technologies like 3D Printing and Collaborative Robots (Cobots) that support rapid prototyping and faster roll out of complex designs, time has come to initiate the new phase, what can be called as Industry 4.0 (I4.0).

The following diagram illustrates this evolution.


Opportunities presented by Industry 4.0

These are a few possible areas where I4.0 could deliver customer value:
  1. Flexible production with 'Plug and Produce' capabilities.
  2. Process standardization across various platforms
  3. Energy management by streamlined energy consumption
  4. Accurate logistics planning
  5. Self healing machines
  6. For Indian IT companies, providing 'Smart Factory', or 'Factory in a Box' as a SAAS offering can be a huge opportunity. 
Most of these technologies are already available as islands of expensive technology. I4.0 will use the power of Internet and communication networks to integrate these disparate technologies to help smooth deployment.

Challenges specific to India
  1. Impact on job creation
  2. Increase in social inequality between 'low skill / low pay' and 'high skill / high pay' jobs.
  3. Redistribution of both technology and its benefits to rural India
  4. Re-skilling and up-skilling existing workforce
  5. Ensuring Gender Neutrality in job creation.
  6. SMEs are not tech savvy
India Potential

Rapid developments in global manufacturing suggest that India’s manufacturing companies could easily fall behind their global counterparts. New technologies and patents are enormously beneficial, but patents from the U.S. and the UK outnumber new Indian technologies over ten to one.

The global market for collaborative robots was estimated at $128 million in 2014 and is projected to reach $1 billion by 2019, with a compound annual growth rate of 50.88 percent.  Though India still has one of the lowest levels of robotic penetration in the automation of manufacturing facilities relative to the rest of the world, over the last few years, many newly incorporated manufacturing companies in the country have adopted smart manufacturing practices and there has been a considerable increase in investments made into new robotic applications, especially in the automotive sector.

Manufacturing Industry in India has the potential to touch $1 Trillion by 2025, forming about 25-30% of the country's GDP (from the current 16%) and giving employment to about 90 Million People. This cannot happen without policy initiatives towards technology adoption. Proactive government policies including 'Make In India', 'Digital India' and 'Smart Cities' will add fillip to I4.0 in India. The smart cities could become the forerunners of the Industry 4.0 environment.

Industry 4.0 needs pool of technology professionals including data scientists, cyber systems experts, technology trainers, project managers etc. India has the advantage of a strong technology ecosystem.

Another unrelated potential is the adoption of I4.0 philosophy to agricultural sector in India. The farming sector can benefit from some of the new technologies. For example, government can use analytic tools to identify the best crops to sow at different areas during different seasons. This information can be used to incentivise the farmers to move towards remunerative farming.

What India must do
  1. Skill Building Initiatives, especially in the high technology areas
  2. Create industry awareness about I4.0
  3. Develop cloud enabled IT Platforms that can be accessed by SMEs
  4. Spruce up the patent regime, enabling faster patent and trademark registrations
Conclusion

Industry 4.0 as an idea that started around 2014, has gained momentum over the last 3 years. The advance has been facilitated by growth of new technologies including cyber-physical systems, big data and analytics and cloud computing. While these technologies even prior to 2014, what makes them Industry 4.0 compliant is the networked nature of deployment. Companies that have adopted these technologies have reaped rich rewards in form of cost reduction and improvement in productivity and efficiency.

Manufacturing Industry, currently forming 16% of country's GDP. With supportive policy framework, the industry has the potential to scale up to about 25 - 30% (1.00 to 1.25 Trillion USD from the current about 0.4 Trillion) in the coming years. Policy initiatives like 'Make in India', 'Smart Cities', 'Digital India' etc,, by providing the necessary hard and soft infrastructure, will act as a catalyst for the industry to adopt advanced technologies. India also has a strong technology ecosystem that can support new technologies. With all these benefits, I see Indian manufacturing industry moving quickly towards Industry 4.0.

The IT Companies in India are at the forefront of enabling global corporations to adopt advanced technologies and this can become a scalable model generating export revenues. Creating I4.0 as a SAAS based offering is one such opportunity.

However, India will have to develop its own I4.0 philosophy keeping in mind its population and the policy objectives like gender equality, equitable technology benefits to all etc.

Industry 4.0: India Case Studies
  1. The Indian Institute of Science (IISc) is building India’s first smart factory in Bengaluru with a seed funding from the Boeing Company.
  2. Bosch, a German auto component manufacturer will begin implementation of smart manufacturing at its 15 centres in India by 2018.
  3. General Electric has invested USD 200 million in the facility in its only multi-modal factory in India where digitally interlinked supply chains, distribution networks, and servicing units form part of this intelligent ecosystem.
References
  1. India must try to profit from ‘Industry 4.0: Karan Billimoria, The Hindu, Feb 18,2016
  2. The India Potential: Bosch India Blog: Dr.Andreas Wolf - Feb 12,2017
  3. Are Manufacturers in India Ready to Adopt Smart Manufacturing? Apr 25,2017
  4. Industry 4.0 / IOT - Products and Solutions: Festo India: 
  5. Industry 4.0 and the Retrofit Opportunity: Festo Global
  6. Industry 4.0: A world of new business models and markets: Festo Global
  7. India and Germany must collaborate to take Industry 4.0 to the next level
  8. Industry 4.0: The future of Indo German Collaboration
  9. Industry 4.0 as a service for digital manufacturing: Forbes India: Jan 10,2017
  10. What is the prospect and future of Industry 4.0 in India? : Quora
  11. What is Industry 4.0?: Quora
  12. 10 Questions and answers about Industry 4.0: Georgio Stergiou: Nov 28,2017
  13. What the Fourth Industrial Revolution means for India: Prajal Sharma: Oct 03,2017
  14. Do countries benefit from I4.0?: Gary Coleman: Jun 21,2017
  15. Industry 4.0 should be India's battle cry: Akash Gupta: Livemint: Jun 09,2017
  16. Industry 4.0 can transform India's manufacturing: ET GBS: Feb 13,2018
  17. Towards smart manufacturing: Industry 4.0 and India: makeinindia.com
  18. How to respond to Industry 4.0: Klaus Schwab: Jan 14,2016
  19. Manufacturing's next act: McKinsey: June 2015
  20. Is your ERP ready for IIOT Challenge?: Terri Hiskey: Epicor
  21. Recent Advances and Trends of Cyber Physical Systems and Big Data Analytics


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