Industry 4.0: Can this be India’s Watershed Moment?

Traditional manufacturing and service-oriented industries are being disrupted in a manner which is unparallel in history. The fourth industrial revolution is driven by technologies such as artificial intelligence, autonomous robots, simulation, big data and analytics, augmented reality, the cloud, cyber-security, additive manufacturing, horizontal and vertical integration and the Internet of Things.

The Fourth Industrial Revolution, also popular as 4IR and Industry 4.0, is characterized by accelerated chances in industries, technology, as well as societal patterns and processes owing to increasing interconnectivity and smart automation. Initially used widely in scientific literature, the term was further popularized in 2015 by Klaus Schwab, the World Economic Forum Founder and Executive Chairman. 

Klaus Schwab emphasizes that the changes express a significant shift in industrial capitalism, rather than merely improvements to efficiency.

The primary drivers of the Industry 4.0 are digitization and integration of vertical and horizontal value chains, digitization of product and services, and digital business models and customer access. 

Trends that characterize this industrial revolution include smart factories, predictive maintenance, 3D printing, smart sensors, information technology-embedded agriculture and food industries, and an accelerated transition to knowledge economy. 

India was not in a position to shape its economic destiny during the first and second industrial revolutions as it was colonised and relatively underdeveloped then. The nation joined the third industrial revolution albeit its economy was not poised for leveraging the same.

However, India cannot afford to bypass the Industry 4.0. According to a United Nations Industrial Development Organization (UNIDO) study, India is among the 22 early adopter-countries using advanced digital production technologies and the only middle-income country in this group.

So, India has to capitalize on it to grow at rapid rates and create jobs by adopting cutting edge technology and new-age tools.

The micro, small and medium enterprises, which are the largest employers in the country, have to adopt technology towards raising productivity and promoting sustainability. There is no doubt that the government’s support is necessary, and so is its eagerness evident, to take the ‘Industry 4.0’ to Tier-2 and Tier-3 cities to make the transformation more inclusive.

In the post-pandemic scenario, the global supply chains have been disrupted and there is a tremendous opportunity which lies ahead for the country.

The world’s sixth-largest economy has been trying to take advantage of a possible shift in international supply chains for the last few years. The government has been focusing on investors looking to add or shift manufacturing outside of traditional bases, such as China, after the Coronavirus outbreak disrupted supplies in 2020.

The World Economic Forum (WEF) predicts that “after a decade of flat productivity, the arrival of the Fourth Industrial Revolution (4IR) is expected to create up to USD 3.7 trillion in value to global manufacturing.”

With India looking to scale up the size of the Indian economy to an unparallel level during the Amritkaal, the next 25 years, by 2047 or 100 years of independence, the country has to take advantage of abundant and cheap labour now.

The adoption of Industry 4.0 is something that the government and industry have to work on together. The Fourth Industrial Revolution is the trend of automation and data exchange at all levels of production aimed at increasing productivity, and efficiency and also addressing the issues of sustainability and climate change.

The government’s initiatives towards facilitating manufacturing including the production-linked incentive (PLI) schemes and ease of doing business as well as promoting exports by pursuing various free trade agreements such as the ones with the UAE and Australia may help.

The speed of current breakthroughs has no historical precedent when compared with previous industrial revolutions. The Fourth Industrial Revolution is characterised by a fusion of technologies that is blurring the lines between the physical, digital and biological spheres.  

In just over five years India has emerged as the world’s third-largest startup ecosystem after the US and China and in April it achieved the distinction of having 100 Unicorns. Each day India adds 25 new start-ups.


The Indian manufacturing sector contributes over 16-17 per cent to the GDP now, with an aim to achieve the still-eluding 25 per cent goal. 

China is known for scale, Germany with precision engineering, and the United States with innovation, India needs to create a brand identity for itself to emerge as a leading player to become the factory of the world. 

The fourth industrial revolution must prove to be historical.

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