Leading SMEs of India 2023

60 | Leading SMEs of India 2023 [ INDIAN SME SECTOR OVERVIEW ] D&B categorized different HS codes intogroups andanalyzed the majorexport sectorof theeconomy. Food & Beverage, Chemicals and Pharma and Engineering aremajor export contributing sectors for India during FY22. These sectors contributes 37% of total exports and also accounts of significant number of MSME. D&B have analyzed these sector to understand growth drivers, challenges and outlook. Also, we have provided data extract about D&B data cloud for these sectors for break-up by industry type, category wise distribution along with inquiries we get from global markets. ENGINEERING SECTOR The engineering sector in India is the largest and widely diversified sector amongst al l industrial sectors in the country. It is divided into two major segments heavy engineering and light engineering and covers sub-segments such as manufacturing iron, steel & related products, manufacturing of non-ferrous metals, industrial machinery, automobiles, auto components, and many other engineering products. Being the largest of the industrial sectors in India, engineering accounts for 27% of total manufacturing units in the industrial sector and employees over 4 mn skilled and semi-skilled workers. The sector accounts for 3.5% of India’s GDP. In FY22, engineer ing goods exports crossed the USD 50 bn. It registered a robust growth of 27% in exports, accounting for almost 12% of India’s total exports. The growth in engineering exports in FY22 is largely attributed to the reopening of global economies and zero duty Export Promotion Capital Goods scheme. The US, UAE, China, Italy, and Germany are the key export destinations for Indian engineering industry, cumulat i vel y account ing for close to one-third of India’s total engineering exports. GOVERNMENT INITIATIVES The government has taken various policy measures that are expected to stimulate the growth of Indian engineering industry. As part of the policymeasures, infrastructure and investments have been included among the seven pr ior i t i es ‘Saptarishi’ of the Union Budget FY24. Some of the key proposals announced in the budget include: • The capital investment outlay increased by 33% to INR 10 lakh crore for FY24. • Investment of INR 75,000 crore, including INR 15,000 crore from private sector has been announced for 100 critical transport infrastructure projects, for last and first mile connectivity for ports, coal, steel, fertilizer, and food grains sectors. • Creation of Urban Infrastructure Development Fund (UIDF) under National Housing Bank, which will enable creation of infrastructure in Tier 2 and 3 cities by supporting viability gap funding, enabling creation of more bankable projects, enhancing access to external funding, among others. • Capital outlay of INR 2.4 lakh crore has been provided for the Railways and INR 2.7 lakh crore for Ministry of Road Transport & Highways. • Customs duty exemption is being provided for imports of speci f ied capital goods and machinery required for manufacturing of lithium-ion cells for batteries used inelectric vehicles as well for batteries used in mobile handsets. INDUSTRY TRENDS Increased capex plans of Indian companies: The revival in capacity expansion plans by various companies in sectors such as infrastructure, power, mining, oil & gas, refinery, s t e e l , a u t omo t i v e , a n d consumer durables are driving demand in the engineering sector . The improvement in capacity utilization, pent- up dema nd f o r c a p i t a l goods, and strengthening of corporate balance sheets post the pandemic year have led companies to augment their capex, thereby spurring demand for capital goods. Dun & Bra street