Advancements in AI will give a boost to economic growth

  • Interviews
  • Jun 07,18
With the government aiming to increase the contribution of manufacturing sector in the GDP to 25% by 2020, smart manufacturing and digitalisation are expected to play an indispensable role in changing the dynamics of industrial manufacturing. Emerging technologies such as drones, RFID (radio frequency identification), driverless vehicles, IoT and artificial intelligence will greatly transform the logistics and transport industry in the coming years, says Gautam Pande, Vice President (Operations)
Advancements in AI will give a boost to economic growth

With the government aiming to increase the contribution of manufacturing sector in the GDP to 25% by 2020, smart manufacturing and digitalisation are expected to play an indispensable role in changing the dynamics of industrial manufacturing. Emerging technologies such as drones, RFID (radio frequency identification), driverless vehicles, IoT and artificial intelligence will greatly transform the logistics and transport industry in the coming years, says Gautam Pande, Vice President (Operations) of GreyOrange Pte Ltd. In this interview, Pande discusses the role of advanced robotic technology to overcome operational inefficiencies and optimise supply chains in the manufacturing sector.
 
What changes are you witnessing in the Indian manufacturing sector?
 
The manufacturing sector grew at a CAGR of 7.32% between FY12 and FY17. However, its overall contribution to the Gross Domestic Product (GDP) is lesser than others. According to the recent data, the IIP grew at 2.5% in April-September this fiscal compared to 5.8% in the first half of 2016-17. However, of late we have seen that the government has been working to attract investment by incentivising indigenous manufacturing, and has benefitted industries like mobile phones, tablets, and electronic products. India is already an automobile hub and sectors such as pharma and defense are inching up.  
 
With the implementation of GST, optimism is rooted in the projected benefits in the new tax regime in the upcoming quarters. Moreover, with shortage of credit and liquidity and loss of working capital due to GST, even small and medium enterprises (SMEs) have reduced their manufacturing output. With impetus on developing industrial corridors and smart cities, the government aims to ensure holistic development of the nation. These corridors are expected to integrate, monitor and develop a conducive environment for the industrial development and will promote advanced practices in manufacturing. 
 
However, while investments and discussions are being made in this space, it is due to lack of understanding of the new age technologies, that manufacturing in India is yet to realise its full potential and still a distant dream. With policies like Make in India and Smart City Mission, India is spearheading the transformative journey towards Industry 4.0.
 
What it will take for India to become manufacturing powerhouse by 2020?
 
Currently, India lacks an adequate manufacturing ecosystem, though the condition for manufacturing ecosystem remains positive. While investments and discussions are being made in this space, manufacturing and making in India need to start running faster and companies need to realise this. Further, India has not yet fully realised its potential as a product economy. The ability to experiment with multiple prototypes and an efficient vendor supply chain is a must which currently is not organised in India. For manufacturing, getting the right kind of quality on a sustained basis is vital. Lack of in-house quality control teams and enabling effective implementation of products at the customer site for easy installation is again a challenge that needs to be addressed. 
 
The current scenario in India is that while we are laying the basic infrastructure, we do have the opportunity to leapfrog and become the next global manufacturing hub. The manufacturing sector of India has the potential to reach $ 1 trillion by 2025 and India is expected to rank among the top three growth economies and manufacturing destinations of the world by the year 2020.
 
The Indian regulatory framework could look at easing up our land acquisition policy for businesses. Further, ease of prototyping, will enable rapid development of product prototypes and enable iterative changes until we get the final product. Time and cost are critical considerations for this. Prototyping can be easy and viable if all the stakeholders involved in the process (suppliers, manufacturers, and other service providers) are situated in the close proximity (manufacturing clusters). Consistent availability of low cost electricity, water, and transportation in the manufacturing clusters and their proximity to major ports is critical for attaining a global competitive edge.Further, it is also important that the government and the industry need to collaborate to reskill the workforce, making them employable in this vision of the future. Lastly, the implementation of the Goods and Services Tax (GST) will make India a common market, which will be a big draw for investors.
 
What is the relevance of new-age technologies in shaping the future of manufacturing in India? 
 
In the increasingly competitive industrial environment, technology-driven manufacturing penetrates the shop floors to enhance efficiency, quality and accuracy in production. From self-driving cars and drones to virtual assistants across the factory floor, new technologies like artificial intelligence (AI), IoT and 3D printing are making inroads to the shop floor, with noteworthy progress in recent years. Now in the fourth phase of industrial revolution, enterprises are merging their virtual and real production domains as much as possible with the help of advanced software and hardware products.
 
The emerging technologies such as drones, RFID (radio frequency identification), driverless vehicles, IoT and artificial intelligence will greatly transform the logistics and transport industry in the coming years. While, warehouses don’t essentially need driverless technologies because they are already enabled with automated guided vehicles (AGV), but the surrounding ecosystem of transport will definitely benefit from the same. This will further increase the amount of predictability and efficiency of the overall supply chain. 
 
How can robotics help Indian manufacturers to make a global impact?
 
In India, the adoption of robotics and AI has been very sporadic so far. Initially robotics found its applications across manufacturing and assembling in automotive industry. Industrial robots have been around for a few decades doing high-precision tasks such as welding and assembling, heavy lifting and auto body painting. Robotics have made automotive assembly lines faster, safer, more cost effective, and efficient- all at the same time. While the entry of robotics has been slow in the other industries over the last few years, their applications are now fast expanding to various verticals in a variety of new sectors such as e-commerce, FMCG and Retail. 
 
According to The World Robotics Federation, the number of robots working in the factories around the world will more than double to reach about 2.3 million by 2018. The role of advanced robotic technology in overcoming operational inefficiencies and optimising supply chains will be critical for the manufacturing ecosystem. It will help businesses improve order fulfilment time, reduce errors, and optimise costs. Technologies like AI will be an important catalyst in solving the manufacturing challenges such as security concerns, minimise wastage, etc. Further advancements in AI will give a boost to economic growth and will drive human employment.
 
India, now needs a framework that allows it to build relevant capacities and competitiveness, at par with global manufacturing standards. Ease of doing business, infrastructure development and foreign direct investment (FDI) will open up avenues for product development and designing in India. The country has a massive opportunity for being a manufacturing destination for the world. With government policies like Make in India and Smart City Mission, India is already spearheading the transformative journey towards Industry 4.0. 
 
Which are the industries, where robotics can play critical role in making India a major manufacturing powerhouse by 2020?
 
In the coming years, robotics will play a critical role in transforming the shop floor and also effecting huge efficiency improvements in supply chain. While sectors like automotive, electronics, pharmaceutical and defense are heavily dependent on robotics process automation, we see an emerging demand from sectors such as consumer packaged goods, e-commerce, omni-channel retail, apparel, and logistics industries. 
 
Advanced robotic technologies, artificial intelligence, IoT and big data will be the game changers in transforming the shop floor. Robotics and India’s expertise in software can be catalysts to promote advanced practices in manufacturing. For instance, at GreyOrange, the artificially intelligent GreyMatter software is incorporated in the GreyOrange Butler, allowing it to drive autonomous collaboration and efficiency optimisation across warehouse functions and processes. It’s always-on AI algorithms learns from large amounts of data and identifies patterns in real-time to make super-smart decisions. It adapts to changing inventory profiles and order fulfilment requirements to optimise path planning and navigation of the robots and racks. This enables the team of robots to work together to maximise storage, streamline zoning, improve space utilisation and accelerate order fulfilment. 
 
What role can SMEs or start-ups play in making India a global manufacturing hub?
 
The current Indian regulatory framework provides good incentives for manufacturers to start their businesses (with perks like easy funding, tax rebate, and cheaper land etc for startups). However, as soon as a manufacturer comes out of its startup tag, all these incentives are gone. In a way, the Indian regulatory framework actually discourages the manufacturing startups to scale up and be globally competitive.
 
On the other hand, we have economies like China that provide second level of incentives, such as easy bank loans and export duty concessions to the startups that scale up their manufacturing capabilities. As a result, lack of a proper prototyping and manufacturing ecosystem, restricts growth for Indian startups in the country. The SMEs, if provided with these benefits, can scale up faster and grow their business footprint, thus, contributing towards making India a global manufacturing hub. 
 
Outlook for Indian manufacturing industry by 2020, and/or, Importance of robotics in India’s mission Manufacturing 2020
 
The manufacturing sector presents a massive opportunity for robotics and automation. Especially with tasks and operations that are complex, repetitive, tiring, or hazardous in nature. For Make in India, robotics process automation will help overcome operational inefficiencies and optimise supply chains to remain competitive. To increase the contribution of manufacturing sector in the GDP to 25 per cent by 2020, smart manufacturing and digitalisation will play an indispensable role in changing the dynamics of industrial manufacturing.
 
About Gautam Pande
Gautam Pande, VP (Operations) at GreyOrange, is also the co-founder of AroundU Labs. Prior to this, he was working as the Vice President, Marketing & BI with the Ibibo group. He was also associated with online portals like Yebhi.com as a Head Categories and as an Entrepreneur in Resident with Jabong.com. With 13 years of cross functional experience in e-commerce, technology & consulting domains in a variety of industries (across India, US & Europe), he also brings with him deep entrepreneurial experience of global best practices in setting up & scaling unstructured startups to data & process driven organisations.
 

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