India | January 2021

India Manufacturing Reimagined:

Now & Beyond
The year 2020 will be reminisced as a period when the COVID-19 pandemic transformed lives and businesses world over. The year brought with
it several challenges and risks which were mitigated over a period time, especially in India’s manufacturing space. This has helped the country
establish itself as a key manufacturing hub globally, and has put it on a double engine growth path; the engines being - Make in India 2.0 and
Atmanirbhar Bharat (self-reliant India).
The country’s primary vision through the year has been to build manufacturing competitiveness through economies of scale, reducing imports,
increasing exports and boosting domestic demand. Improvements in the Ease of Doing Business as a result of active interest from several states
also led to easy and hassle-free support to investors in the manufacturing sector. Aside, forming and successfully implementing the Production
Linked Incentives Programme has given the sector a major boost.
Interestingly, leased manufacturing spaces have gained strength in 2020 with strong absorption of built manufacturing leasing spaces in top eight
cities from several sectors including electronics and mobile manufacturing, electrical equipment, white goods, packaging etc. Notably, Chennai,
Pune and Delhi NCR were in pole positions in 2020, with nearly 3/4th of the total leased manufacturing absorption in top eight cities. Bengaluru,
Ahmedabad, Mumbai and Hyderabad have also shown strong growth trends driven by some specific sectors.
Also, in the ‘regionalisation’ battle to attract manufacturing investments, India stood out in 2020. A closer look into announced greenfield
manufacturing FDI projects in 2020 reveals that India leads the pack among MITI-V countries (Malaysia, India, Thailand, Indonesia and Vietnam)
with the largest number of projects announced as well as investment committed in 2020.
Among all uncertainties during the COVID-19 pandemic, 2020 has catalysed the manufacturing and distribution supply chain growth story of
India by creating a significant window of opportunity to emerge as a global manufacturing hub. According to an estimate by Government of India,
manufacturing has an opportunity to reach approximately 25% of its GDP, compared to 15% in 2019. Manufacturing sector is enroute a sturdy and
sustainable future.
Happy reading!

Ramesh Nair
CEO & Country Head, India, JLL
RN.Office@ap.jll.com
India Manufacturing Reimagined: Now & Beyond | 2
 Advantage India Snapshots
India Rankings

Economy Consumer Market Rail Network Road Network

Largest Economy in Largest after US Largest Network Largest Road
World in 2019, Overtaking and China by 2030 of Rail Length in Network in the
the UK and France. (Source: WEF) the World World

Mobile Data Fintech Start-up Language

Highest Data Usage Highest Fintech Largest Start-up Largest English-
Per Smartphone Per Adoption Rate Ecosystem in the Speaking Population
Month In The World Globally of 87% World in the World

Iron Copper & Thorium Coal & Zinc Renewable Energy

Largest Iron World’s Largest Largest Coal & Largest Renewable
Reserve in the Copper and Zinc Reserves in Energy Expansion
World Thorium Reserves the World Plan Globally

Pharmaceutical Vaccine Electronics Automobile

Largest Pharmaceuticals Largest Vaccine Largest Mobile Handset Largest Vehicle Market by
Industry in the World Producer Manufacturing in Volume (1st in Tractors,
(By Volume) Globally World 2nd and 3rd in Wheelers)

Oil & Gas Chemical Food Processing Defence

Largest Refiner Largest Producer World’s Largest Milk Largest Defence
in Asia of Chemicals in Producer, 2nd Largest Budget in the
Asia by Volume in Fruits & Vegetables World

1st Row: Economy & Infrastructure 2nd Row: Technology & Labour 3rd Row: Energy & Natural Resource 4th & 5th Row: Industrial Sectoral strengths India Manufacturing Reimagined: Now & Beyond | 3
Introduction
Year 2020 has been a year of ‘new normal’ kick started by the disruptive
changes across the world. Manufacturing is no different. The pandemic
has catalysed radical thinking and solution seeking approach by
the country. Resultant of which, India now stands at the pedestal
of a new growth curve of industrialisation, driven by technological
prowess, inventive disruptions and some welcome policy changes.
This whitepaper attempts to explore what has changed in 2020 in the
manufacturing space in India and how it has a long-term effect.

India Manufacturing Reimagined: Now & Beyond | 4

Regionalisation of Supply Chain
COVID-19 pandemic has elevated the importance of supply chain risk mitigation, with a major COVID-19 risks perception survey for the World Economic Forum
highlighting a protracted disruption to global supply chains as one of the most likely ‘fallouts’ for the world1.
Building greater supply chain resilience has become an increasing area of focus for companies globally, resulting in some reconfiguration of supply
chains, including changes in the location of industrial and distribution facilities. The most basic rule is to avoid manufacturing or sourcing everything
from one location or country and evaluating the upstream sources to lessen the risk of disruption. Companies globally are re-evaluating their domestic &
regional distribution networks to ensure they are aligned, with goods sourced regionally, manufacture and to supply demand in the same region – that’s
‘Regionalisation’ of Supply Chain.
This changing dynamic of manufacturing & distribution supply chain, catalysed by the pandemic in 2020, has created a significant window of opportunity for
India to emerge as a regional or global manufacturing hub.

World Economic Forum/Marsh & McLennan and Zurich Insurance Group, COVID-19 Risks Outlook. A Preliminary Mapping and its Implications, May 2020.
1
India Manufacturing Reimagined: Now & Beyond | 5
India has an inherent advantage of being very close to the Global Maritime Route (shown in the diagram). More than 60% of global maritime trade volumes
are transported along this route. Just to give an idea of the scale - roughly 90% of the world’s goods are transported by sea. However, favorable location along
would not suffice for Regionalisation led manufacturing in a country, it calls for evaluation of various other parameters in the country like domestic consumer
size, source of raw materials, labour, tax among various others. In this ‘Regionalisation’ battle, India and some ASEAN countries will compete to get their fair
share of manufacturing. The table below gives an idea on some of the major parameters in few countries

How India Fares Among MITI-V Countries - Key Statistics

Country India Malaysia Indonesia Thailand Vietnam

Population (in USD

1,366 32 271 70 96
million) 2019

GDP (in USD billion) 2019 2,869 365 1,119 544 262

Domestic Consumer Market

971 218 102 272 185
Size (in USD billion) 2019

Labour Force
500 16 137 39 58
(in USD million)

Tax Rate/Corporate Tax Rate for

New Manufacturing Units, 2020
15%* 24% 25% 20% 20%

EoDB Ranking, 2020 63 12 73 21 70

Source: World Bank database | PIB on Corporate Tax Rates | Doing Business – 2020, World Bank Group. Exchange rate 1 USD = INR 74
*Corporate Tax for new manufacturing units in India = 15% + Cess applicable= 17.16% to new manufacturing units operational before 31st March 2023
India Manufacturing Reimagined: Now & Beyond | 6
Manufacturing - Double Engine Nitro Boost
While regionalisation of supply chain has triggered the transformation on the manufacturing sector, India further delved to strengthen its core by the
‘Atmanirbhar Bharat’ or ‘Self-reliant India’ initiative (launched in May 2020). With an objective of reducing dependence on imports and focussing on existing
strengths, Atmanirbhar Bharat, has put India on a ‘Double Engine Growth Path’. Engines being - Make in India 2.0 & Atmanirbhar Bharat.

Make in India 2.0 Engines Atmanirbhar Bharat

To make India a global manufacturing powerhouse and promote To make India self-reliant by promotion of domestic manufacturing
Objective
Exports from India for advanced value-added commodities. and harnessing the existing strengths and reduce Imports

Sectoral High Import Commodities (% of Import, 2019):

Focus
Electrical Machinery, Organic Chemicals
Electronics EV Components Set-top Boxes
Equipment (10.5%) (4.3%)

Auto Air Fab, Semiconductor Machinery & Optical, Technical,

Components Conditioners & Circuits Computers (9.2%) Medical Devices (2%)

Robotics & Fertilizers

Pharmaceuticals
Drones (1.5%)

Aerospace & Medical Harness Existing Strengths:

Defence Devices
Food Processing, Ready to Eat,
Televisions, Toys, Furniture, Textiles, Metals,
CCTV & Cameras Leather & Footwear, Ayurvedic
Medicines, Fisheries, Ethanol,
Sporting Goods &
Gym Equipment Ceramics, Glass, etc.
Disclaimer: Based on JLL observations from qualitative and quantitative market research. This is just an indicative list of sectors and not exhaustive. India Manufacturing Reimagined: Now & Beyond | 7
What Was New in 2020?
The year 2020, while it will be long remembered as a year which saw a virus ruling the world and transforming the way the world used to see business,
lifestyles etc, it is also the year, which has transformed the way how several challenges & risks are being mitigated. Here’s a few things that has happened in
manufacturing space in India in 2020 that has or might go a long way to establish India as a major manufacturing hub of the region or globe.

A Industry- Government Consultation

Conceptualised immediately after the nationwide lockdown in March 2020

and formalised in July 2020 a new committee was formed titled ‘Steering
Committee for Advanced Local value-add & Exports (SCALE)’ Committee
under Ministry of Commerce, Govt. of India. SCALE Committee is headed by
Mr. Pawan Goenka, Managing Director of Mahindra & Mahindra - an Indian
multinational automobile manufacturing corporation.

SCALE Committee: Key Highlights

• Sectoral Groups: Includes 12+ Sectoral working groups.
• Approach: Each working group has a representation from at least 6 -7
leading Indian & global companies in each manufacturing sectors.
• Identify Sector Specific Critical Bottlenecks: Identify top four to five critical
issues for each sector, which if addressed, could trigger immediate recovery
and bring in long-term benefits and accelerate manufacturing in India.
• Identify Broader Issues: Apart from specific industry issues, the broader
issues like expensive industrial power, inefficient logistics such as
bottlenecks at ports and challenges from Free Trade Agreements (FTA) etc.
• Remove Bottle Necks: Liaison with respective ministry / departments in
Government and Private stakeholder to mitigate issues like;
• To ease the burden of over regulation,
• Remove embedded taxes
• Reduce logistic cost
• Suggest changes in FTAs that benefit the local industry
• Bringing down power tariff
• Skill development
• Encouraging / incentivising industry to build scale, invest in technology and R&D.
India Manufacturing Reimagined: Now & Beyond | 8
B Policies to Drive Change

In the manufacturing space, India’s primary vision is about building manufacturing competitiveness through economies of scale, reducing imports, increasing
exports and boosting domestic demand.

Economies of Scale S Reduce Imports
Creating ecosystem and enabling
environment for industrial sectoral
growth not only for the larger
manufacturing units but also their
ancillary and vendors.
I Increase Exports E Boost Demand & Others D
Conscious efforts to selectively Make necessary policy Boost domestic demand by
chose sectors which has changes in making India restructuring sourcing norms
high potential for domestic globally competitive / guidance and remove policy
manufacturing and promotion of manufacturing destination bottlenecks.
those in order to reduce imports. that would boost exports

India Manufacturing Reimagined: Now & Beyond | 9

There have been several policy changes to drive the above objectives in 2020 in India. Some of them listed below:
Broad Objective*
Select Policy Changes in 2020
S I E D
Major Port Authorities Bill, 2020 – March 2020
- Promote the expansion of port infrastructure and facilitate trade and commerce by decentralizing decision, decluttering regulations etc.
Scheme for Promotion of Manufacturing of Electronics Components and Semiconductors (SPECS) - April 2020:
- Incentives scheme on Capital Expenditure for setting up electronics manufacturing units
Modified Electronics Manufacturing Clusters Scheme (EMC 2.0) - April 2020
- Strengthen infrastructure base for Electronics Sector. Incentives scheme for developers of EMC
Production Linked Incentive Scheme for Large Scale Electronics Manufacturing - April 2020
- Incentives of 4% to 6% on incremental sales (over base year) of goods manufactured in India
Production Linked Incentive Scheme for Promoting Domestic Manufacturing of Medical Devices – May 2020
- Incentive of 5% on incremental sales (over base year) of goods manufactured in India
‘Scheme for Promotion of Medical Device Parks – May 2020
- Grant-in aid for development of 4 Medical Device Parks in India
Micro, Small and Medium Enterprises Definition Change (MSME)- June 2020:
- Redefinition of MSME & its classification to improve domestic manufacturing
Scheme for Promotion of Bulk Drug Parks – June 2020
- Easy access to standard testing and infrastructure facilities through creation of Infrastructure facilities
Bonded Manufacturing Scheme – Updated July 2020 onwards
- Allowing import of raw materials & capital goods without payment of duty for manufacturing and other operations
Turant Customs – Modified July 2020
- Faceless, Contactless and Paperless’ Customs administration and clearance relying highly on technology
PLI Scheme for APIs – July 2020
- Financial Incentives shall be given based on threshold investment & domestic sales made by selected applicant for products
Amendment in Import Policy of Television – July 2020
- Import policy of Colour Television (LCD & LED) amended from ‘Free’ to ‘Restricted’ Listed.
Amendment in Import Policy of Air Conditioners (ACs) with Refrigerants – October 2020
- Import ban on air conditioners (ACs) with refrigerants
Notification of Labour Codes – November 2020
- Reducing 40 plus laws into 4 labour codes to reduce compliance burden.
* Note: S = Economies of Scale; I = Reduce Imports; E = Increase Exports & D = Boost Demand & Others India Manufacturing Reimagined: Now & Beyond | 10
Source: Compiled from various policy documents / Government order (GO) / notifications etc. Refer to these documents for details.
C Ease of Doing Business Innovations

2020 has been a year of innovation on Ease of Doing Business (EoDB) parameters and approvals. Several states in the country has come up with fresh
ideas and implementation mechanisms to provide easy and hassle-free support to manufacturing investors.

Some of EoDB Innovations Include:

• Provide licences for
automatic, accelerated and
time-bound permissions for
FDI in manufacturing of Rs 50
Crore ($ 6.7 Mn) & above.
• Ease of compliances
including online approvals
and tracking mechanism
• Reducing the number
of permissions required
for starting an industry
to 5 from an earlier 14 in
some states.
• Coming up with sector
specific industrial policies
eg. electronics
• Industry (including large,
medium and small-scale
industries) would not need
any statutory permissions
for the first three years
or start of operations, or
whichever is earlier to set up
manufacturing operations
in the state. Only self-
declarations would suffice.
• Approve manufacturing
investments based on self-
disclosures within 30 days of
submission or it is considered
as deemed approved.
• Changes in the labour norms
to make it easier and investor
friendly & many more.

Central Government has recently announced about setting up a Central Single Window System / Centralised Investment Clearance Cell for clearances
and approvals of industry in the country and expected to be initiated or announced in the next budget session in Q2 2021. Key aspects include;

• One-stop digital platform to obtain all requisite • Eliminate the need for investors to visit multiple platforms/ offices to
central and state clearances/approvals gather information and obtain clearances from different stakeholders and
required to start business operations in India. provide time-bound approvals and real time status update to investors.
India Manufacturing Reimagined: Now & Beyond | 11
D Production Linked Incentives (PLI) Programme

One of the major boosts to the manufacturing sector is India’s shift from Capital Investment linked incentives to Production Linked Incentives (PLI), introduced
in 2020. The PLI programme offers close to INR 200,000 crore (around USD 27 billion) worth of incentives to a chosen number of large manufactures in 13
sectors over five years based on incremental output delivered.

Incentive Outlay under Production Linked Incentive (PLI) Programme LI in the next 5 years PLI Example: Mobile & Electronic Components

Approved Financial Outlay for PLI over a Five-Year Period ($Mn)

Mobile Phones and Specified
Automobiles & Auto Components 7,708 Electronic Components

Mobile & Electronic Components 5,534 Incentive Quantum USD 5.5 billion. in total
Advance Chemistry Cell Battery 2,446 4% to 6% on incremental sales
(over base yr i.e. 19-20)
Pharmaceuticals drugs 2,027 Applicability: From Aug, 2020

Telecom & Networking Products 1,648 Incentive Tenure

Food Products 1,473 5 years from base

MMF & Technical Textiles 1,444 USD 27 billion Eligibility / Evaluation

Incentive Provisioned Thresholds of incremental investment & sales
Drug Intermediaries & API 938
Speciality Steel 854
EoI Route of Selection
White Goods (ACs & LED) 843
Electronic / Technology Products 678 Eligible Applicants Ceiling:
- Mobile (Priced INR 15,000+) - 5
High Efficiency Solar PV Modules 608 - Mobile (Domestic) - 5
- Electronic Component - 10
Medical Devices 462
Source: Key Cabinet Decision released by Press Information Bureau, Delhi, Nov 2020. Exchange rate: USD 1 = INR 74 India Manufacturing Reimagined: Now & Beyond | 12
PLI Advantages

Anchor Scheme
Intends to incentivise only a select few large
manufacturing companies (Global & Domestic)
based on merits and defined investment, sales,
domestic value-add and other criteria. Objective
is to promote anchor manufacturers to create an
economics of scale. Smaller & ancillary units will
follow naturally as per the value chain needs of
such anchor manufacturers.
Immediate & Time bound
Applicable to incremental
investments and sales for Brownfield
as well as Greenfield projects.
Incentives come with an expiry date
and gives just the needed push
and a ‘window of opportunity’ to
manufacturers to kick-start as soon as
possible to avail these incentives.
Specialised & High Value-added Sector
Focus on sectors that has high value-add to achieve
sectoral specialisation. The program also intends to
strengthen and incentivise value-add segment of sectors
wherein India has inherent strengths. i.e. India is world’s
largest milk producer & world’s 2nd largest producers in
fruits & vegetables. The scheme would help promote the
value-adds in Food Processing industries i.e. Milk processing
(butter, cheese, ice-creams etc.), jams, jelly, juice, puree etc

A recent Credit Suisse report titled “India Market Strategy – PLI Schemes” predicts that PLI programme
will add 1.7% to Indian GDP by financial year (FY) 2027. The report outlines how bulk of the additional USD144
billion sales across these 13 sectors will be exported, thus also shrinking Indian trade deficit by USD50 billion.

India Manufacturing Reimagined: Now & Beyond | 13

Manufacturing Real Estate Options
For any manufacturing investments, real estate forms a significant part of the initial
capital expenditure. Major real estate entry options for any manufacturing investor
exploring India would be primarily as follows;

Manufacturing Real Estate Options

Land Land & Building

Government Privately Lease Lease to

Owned Land Owned Land Buy

India Manufacturing Reimagined: Now & Beyond | 14

Appraisal of the manufacturing real estate options

Land Land & Building

Parameters
Govt. Owned Private Owned Lease Lease to Buy

Long lease of land with

Leasing of speculative or Leasing of built space and &
tenure ranging 30 - 99 Typically, outright purchase
customised industrial built underlying land for a certain
Type & Tenure years paying upfront lease of land. Can be long lease of
spaces and underlying land tenure* and having the right
premium & annual nominal land at times.
for 7 - 15 years tenure* to buy post that.
lease rental

Capital expenditure on land

Hybrid Model: Capex light in
& building on 3rd party /
Manufacturer Acquire land + construction Acquire land + construction initial years followed by an
developer. CapEx light -
Scope (self / contracted) (self / contracted) option to manufacturer to
CapEx to OpEx (say monthly
buy the asset.
rent)

Model Buy & Build Buy & Build Plug & Play Plug & Play

• Private industrial parks /

• State Industrial • Private industrial parks / • Private industrial parks /
developers
Where to get these Development developers developers
• Corporate land bank
real estate options? Corporations • Private land + development • Private land +
• Private individual landlord
• Other govt. and Bank investor development investor
• Aggregated land

Each of the real estate options have their own set of advantages and disadvantages and should be property evaluated
based on criteria and priories including but not limited to - asset creation strategy, speed to enter, preferred
Remarks location, different and flexibility of pricing / pricing structure, plug & play, scale etc. JLL can handhold and advise
a manufacturing investor from conceptual stage of location section through incentives, transaction advisory and
project management i.e. till operation / commissioning of manufacturing plants in India.

Note: This does not include other avenues or outliers like industrial gala or multi-stories industrial building (typically RCC structures) for specific sectors or acquisition of any existing operational / closed manufacturing plants.

India Manufacturing Reimagined: Now & Beyond | 15

Incentive Availability
& Manufacturing Real
Estate
In order to understand the applicability of various
incentives available manufacturing investments in
India from state or central government, we delve deep
into details Income & Expenditure of such firms.

Capital Expenditure (CapEx)

• Land (~ 10% - 15% of project cost)

• Building (incld. infrastructure)
• Plant & machinery

Operating Expense (OpEx)

• Cost of production (raw material +

manpower cost)
• Cost of utilities (water, power, gas etc.)
• Applicable taxes & fees
• Marketing & distribution cost

Sales or Production linked Income

• Sales of finished goods in domestic

Indian markets or exports
• Sales of by-product, if any.
Note: Investment / cost of land of typically 10% -15% of the entire CapEx. Above
details are broad and indicative only for major head. Actuals would vary as per
sector, type of production unit, location etc.
India Manufacturing Reimagined: Now & Beyond | 16
 Major Fiscal
Details / Inclusion & Exclusion Modality of Payment Who Pays?
Incentives
CapEX Linked % of capital investment / CapEx Cash back / reimbursement State Govt.
Refund / exemption of OpEx like electricity duty waiver, power tariff reduction, water
OpEx Linked Exemption / cash back. State Govt.
tariff reduction, stamp duty reduction / waiver, registration charges waiver etc.
Specified % of sales tax paid (VAT/CST/GST) to the state government for goods sold in Domestic & State sales tax linked
Sales Linked State Govt.
the state (where the investment is grounded). for a specified time horizon
One-time incentives i.e. ‘Greener’ production measure, HR measures, R&D etc. (Part
Others Capital Subsidy / Cash back State Govt.
of CapEx)
Production Specified % of production for specified commodities over a specified time. CapEx Central
Cash Back / Reimbursement
Linked incurred on land and building is NOT covered in PLI. Govt.
MOOWR Manufacture and other operations Regulations, 2019 - Deferment of Duty for Central
Duty deferment
Scheme imported Plant & Machinery (part of CapEx i.e. Plant & Machinery) Govt.
Note: These are indicative list of major incentives available.

Fiscal Incentives MythBusters:

Incentives are offered based on size of investment, Most states in India are divided into various zones / blocks / regions
employment generation, location in a state, incremental based on their development. Incentives vary such across regions
sales / production etc. and not the real estate entry option within the same state. Typically, highly developed areas offer lower
chosen i.e. land (govt./ private) or built-up incentives and vice versa.

Both Central and State incentives may be availed States might also have sector specific policies (i.e. Electronics, Pharma
simultaneously, if there are any relevant central government etc.) granting special incentives to their thrust sectors. Such incentives
scheme available for the sector etc. are also available to manufacturing investors in the sector.

All enterprises, Indian or Foreign, can avail both Central Most states also have the concept of ‘Mega Projects’ defined by
and State incentives for new / Greenfield as well as for investment sizes. If a project qualifies as a ‘Mega Project’, custom
expansion in existing manufacturing plants i.e Brownfield. made incentive packages can also be offered by the state.

India Manufacturing Reimagined: Now & Beyond | 17

Manufacturing Built Space Dynamics, 2020
While historically, large & medium scale manufacturer usually opted for land buy and build their factories,
the concept of leased manufacturing spaces has been gaining strength in the country over the years. 2020
revealed a strong demand of built manufacturing leasing with a Gross Absorption of 6.6 million sq. ft. in
top 8 cities. Chennai and surrounding areas topped the chart with over nearly 36% of gross absorption
driven by pro-active governance, developed manufacturing ecosystem, proximity to multiple seaports etc.
Pune stood 2nd with around 20% of manufacturing-built lease with presence of strong ecosystem,
organized supply and a large immediate catchment of urban conurbation of Pune & Mumbai.
Delhi NCR emerged a close 3rd with 18% of gross absorption in 2020 backed by strong manufacturing
demand from sectors including but not limited to electronics & mobile manufacturing, electricals, white
goods, packaging etc.
Ahmedabad, Bengaluru, Mumbai & Hyderabad have also shown strong growth trends driven by some
specific sectors.

Table: India Built Manufacturing Absorption / Leases, 2020

Cities Outlook Key Regions / Submarkets of significance

Chennai + Oragadam, Mannur, Marai Malai Nagar, Vallam, Tada (AP)
Pune Chakan, Talegaon, Nagar Rd - Ranjangaon, Bhosari
Delhi NCR Noida, Greater Noida, Manesar, Sonipat, Faridabad
Ahmedabad Changodar, Bavla, Kheda, Vitthalapur - Becharaji, Kalol
Bengaluru Hoskote, Dabaspete - Nelamangala, Bommasandra, Attibele
Mumbai Taloja, Thane vicinity, JNPT vicinity
Hyderabad Patanacheru, Shamirpet, Medchal, Shamshabad - Kothur
Kolkata Sankrail - Dhulagarh – Uluberia, NH 02 Dankuni vicinity
India 6.6 million sq. ft. of Gross Absorption*
Source: JLL Industrial Services. ***** = Strongest future outlook, * = Weakest future outlook
Note: Chennai + = Chennai and its surrounding area including Tada, Sricity etc. India Manufacturing Reimagined: Now & Beyond | 18
*Gross Absorption = Net Absorption + Churning + Renewal
A Sectoral Distribution of Built Manufacturing

It’s interesting to note that several sectors chose leasing of built manufacturing space and most of them overlap with the sectors of focus in Atmanirbhar Bharat
and Make in India 2.0.

Major Manufacturing Sectors Opting for Built Manufacturing:

Electronic, Mobile Electricals, Sensors Home Appliances Technical Textiles

Component Manufacturing & Mission Critical Manufacturing Manufacturing &
& Assembly Components And Assembly Finishing

Auto, Electric Vehicle, Pharma & Medical Devices Battery

Engineering Assembly Life Sciences Manufacturing Manufacturing
& Workshop Manufacturing

Furniture Manufacturing Solar PV & Food Packaging (Manufacturing of

(Hospital Beds & Ancillary, Renewables Processing Paper Bags, Boxes, Cartons,
Office & Home Furniture) Manufacturing Printing, Adhesive Tapes etc.

Built manufacturing spaces offers several advantages including but not limited to faster entry, high-end / globally comparable specifications, higher CapEx
savings, easy approvals for many sectors etc. Additionally, incentives are available under several buckets for manufacturing in such built space. In near to
medium term, outlook for such flexi, fast and customised (BTS) options in manufacturing is expected to be very strong.

India Manufacturing Reimagined: Now & Beyond | 19

B Changing Trends

Built manufacturing spaces in India are also transforming to the changing needs of the sectors, some of which is captured below;

Gradually moving up from 3-5 years to 7-9 years and in

Lease tenure
some cases even 15 years

Seen to go up from 2-3 years to 5 - 7 years and in some

Lock-in period
cases up to 9 years

Tenant improvements in built manufacturing spaces can

typically include;
• Floor load of 5-10 tn / sq. m.
• Electronics, mobile and light assembly are also
considering mezzanine / 1st floor as shop floors with
floor load of 2 - 3 tn / sq. m.
Tenant • Roof crane / mounting cranes
Improvements • High quality flooring & epoxy flooring
• Power connection including transformer and internal
cable laying
• Power back-up
• Admin / office - fully furnished / semi furnished
• Ventilator / HVAC in depending on the operations
• High grade fire sprinklers

Source: JLL Industrial Services. India Manufacturing Reimagined: Now & Beyond | 20
 Manufacturing Greenfield FDI Performance, 2020
In the regionalisation battle to attract manufacturing investments, India stands out in 2020. Deeper
look into announced greenfield manufacturing FDI projects in 2020, reveals that India leads the
pack among MITI-V countries with the largest number of projects announced as well as investment
committed in 2020.

Manufacturing Greenfield FDI Announcement (Jan, 2020 - Dec 15, 2020)

Manu. Greenfield FDI announced (USS Bn.)

80 12.0
11.3
70 10.3 10.0
No. of projects announced

60
50
49 8.0

40 6.0
30 4.1 23
20 4.0
20 14 12 2.0
10 1.1 1.3

0 -

India Indonesia Malaysia Thailand Vietnam

Source: Moody’s Database.
Note: The data does NOT include FDI in IT, Telecom and software and only captures details of announcements of manufacturing greenfield FDI in
these countries. The data includes such announcements from 1st Jan 2020 to 15th Dec 2020. Actual grounded investments would vary and can only
be appraised over a period.

India Manufacturing Reimagined: Now & Beyond | 21

Manufacturing
Investment Teasers, 2020
The ‘Double Engine’ nitro boost from Make in India 2.0 and
Atmanirbhar Bharat can truly be seen from a plethora of
investment announcements, MoU signed and commissioned
plants in India in 2020. Investments are proposed across all
major sectors of focus i.e. Electronics, Renewable Energy, Auto,
EV and Batteries, Electricals, Pharma, Food Processing, Defense
Manufacturing, Steel & Metallurgy etc. Here’s a list of a few key
investments announced by Foreign MNCs as well Indian & Indian
MNCs in the manufacturing space in 2020.

India Manufacturing Reimagined: Now & Beyond | 22

A Key Foreign MNC Investment Announcements in 2020

Origin Investment
B/G Company Name Sector Location Details of Manufacturing Unit
Country (in USD million)

B Samsung Electronics South Korea 652 Noida, Uttar Pradesh Mobile & IT display production
B Foxconn Electronics Taiwan 541 Chennai, Tamil Nadu Mobile contract manufacturing
G Wistron Electronics Taiwan 171 Bengaluru, Karnataka Smart phones, IOT & biotech devices
G Pegatron Electronics Taiwan 149 Chennai, Tamil Nadu Mobile contract manufacturing
G First Solar Renewable USA 566 Tamil Nadu Solar module manufacturing
G Eickhoff Wind Renewable Germany 55 Tamil Nadu Windmill component manufacturing
G Alliance (ATG)- Yokohama Auto+EV Japan 168 Vizag, Andhra Pradesh Tyre manufacturing
B Kia Motors Auto+EV South Korea 54 Anantapur, Andhra Pradesh Manufacturing SUV vehicles
G Mitsubishi Electric Electricals Japan 68 Pune, Maharashtra Electricals & systems manufacturing
GC Emerson Electric Electricals USA 57 Pune, Maharashtra Isolation & actuation valves. Inaugurated, Dec,20
G Sami-Sabinsa Group Pharma USA 81 Hassan, Maharashtra Nutraceuticals & cosmeceutical manufacturing
G PepsiCo F&B USA 110 Mathura, Uttar Pradesh Potato Chips manufacturing
G AB Mauri F&B UK 54 Bundelkhand, Uttar Pradesh Yeast manufacturing
G Defence Manu. Co. Defense Russia 338 Salem, Tamil Nadu Aircraft components & drones
G Major Oil Co. POL USA 103 Raigad, Maharashtra Lubricant blending plant
G IMR Metallurgical Metal + Switzerland 1,622 Kadapa, Andhra Pradesh Steel plant
B ArcelorMittal Nippon Steel Metal + Luxembourg 676 Hazira, Gujarat Finished Steel production unit
Abbreviations: B/G = Brownfield / Greenfield, GC= Greenfield & Commissioned, Auto + EV = Automotive, components, Electric Vehicle and ancillary, Renewable = Renewable Energy, F&B = Food & Beverage /Food Processing, Electronics =
Electronics and white good, UP = Uttar Pradesh, TN = Tamil Nadu, AP = Andhra Pradesh, MH =Maharashtra, KN = Karnataka, GJ = Gujarat, TS = Telangana. Exchange rate: USD 1 = INR 74
Disclaimer: Data is a compilation from various media / news releases, market information / market intelligence. While every care is taken to validate the announcements, Jones Lang LaSalle does not accept any liability for negligence or
otherwise for any loss or damage suffered by any party resulting from reliance on this data.
India Manufacturing Reimagined: Now & Beyond | 23
B Key Indian & Indian MNC Investment Announcements in 2020

B/G Company Name Sector Investment (in USD mn) Location Details of Manufacturing Unit
G Tata Electronics Electronics 676 Hosur, Tamil Nadu Mobile Phone component manufacturing
G Voltas Electronics 135 Kanchipuram, Tamil Nadu AC & refrigeration products
G Abaj Group & Qthree Electronics 135 Mehsana, Gujarat LED TVs and AC manufacturing
G ReNew Power Renewable 216 Rajasthan Solar cell & Module manufacturing
G Evolet Auto+EV 68 Telangana Lithium-ion battery manufacturing
G Tata Chemical Auto+EV 541 Dholera, Gujarat Lithium-Ion Battery Plant
GC Apollo Tyres Auto+EV 514 Chitoor, Andhra Pradesh Tyre manufacturing. Commissioned, Jun 20
G Ola Electric Mobility Auto+EV 324 Hosur, Tamil Nadu Electric 2 wheeler manufacturing
G Kinetic - Lamborghini Auto+EV 236 Andhra Pradesh EV, battery charging stations, R&D etc.
G Bajaj Auto Auto+EV 88 Pune, Maharashtra KTM, Husqvarna and Triumph 2-wheelers & EV
G Granules India Pharma 54 Hyderabad, Telengana finished pharma dosage
G Laurus Labs Pharma 41 Hyderabad, Telengana Formulation Plant
G Varun Beverages F&B 111 Ahmednagar, Maharashtra PepsiCo franchisee. Bottling plant
G Britannia F&B 41 Nr. Lucknow, Uttar Pradesh Confectionary - bread, biscuits etc.
G Dalmia Bharat Cement 270 Kalaburgi, Karnataka Cement plant
G Epsilon Carbon Chemical 122 Bellary, Karnataka Integrated Carbon black facility
G Vedanta Limited Metal + 635 Nr. Surat, Gujarat Zinc-lead-silver smelter complex
Abbreviations: B/G = Brownfield / Greenfield, GC= Greenfield & Commissioned, Auto + EV = Automotive, components, Electric Vehicle and ancillary, Renewable = Renewable Energy, F&B = Food & Beverage /Food Processing, Electronics =
Electronics and white good, UP = Uttar Pradesh, TN = Tamil Nadu, AP = Andhra Pradesh, MH =Maharashtra, KN = Karnataka, GJ = Gujarat, TS = Telangana. Exchange rate: USD 1 = INR 74
Disclaimer: Data is a compilation from various media / news releases, market information / market intelligence. While every care is taken to validate the announcements, Jones Lang LaSalle does not accept any liability for negligence or
otherwise for any loss or damage suffered by any party resulting from reliance on this data.

India Manufacturing Reimagined: Now & Beyond | 24

Way Ahead
Among all uncertainties in this pandemic,
2020 has also catalyzed the manufacturing
growth story in India. Driven by the double
engine nitro boost in making India global /
regional manufacturing hub (Make in India 2.0)
and self - reliant India (Atmanirbhar Bharat).
The sector is en-route to much sturdy and
sustainable future. In a recent Morgan Stanley
research titled ‘India’s Manufacturing - At an
Inflection Point’, it is estimated that India’s
manufacturing as a share of GDP will rise from
approximately 15% of GDP in 2019 to 20% by
FY 2030, implying that manufacturing pie in
India will increase 3 times by 2030. India has
a unique opportunity in leveraging its vast
pool of skilled resources, competitive costing,
inherent strengths, eco-system & positioning
in the global supply chain reconfiguration
race. Several initiatives, policy and incentive
packages offered in 2020 and more upcoming
is expected to keep the manufacturing sector
warm and buzzing in the next few years.

India Manufacturing Reimagined: Now & Beyond | 25

For business enquiries, please contact:

Yogesh Shevade Aditya Desai

Head - Industrial Services, India, JLL Executive Director, Head - PDS Business Sales & Investor Services, India, JLL
Yogesh.Shevade@ap.jll.com Aditya.Desai@ap.jll.com

About JLL Industrial Services

JLL Industrial Services is a leading end to end Industrial real estate service provider in India with “specialisation ” in manufacturing and logistics transactions,
research & consulting , Ports, Airports & Global Infrastructure (PAGI), supply chain consulting & logistics solutions, investment advisory. Our services are
spread across several asset classes including Warehousing, Manufacturing, Cold Storage, Multi-Modal Logistics Parks (MMLP) & Free Trade Warehousing
Zones (FTWZ) among others. The 80 members strong team services more than 30 Tier I & Tier 2 cities in the country. The team has successfully concluded
665+ number of transactions adding up to more than 63+ Mn. sft. of built-up leasing and 2,400+ acres of land in both private and government sector. Team
has also done 195+ industrial consulting and supply chain consulting studies / projects in India and abroad. Industrial Services Team is also known for its
cutting-edge thought leadership research & maps in the manufacturing and logistics domain.

About JLL PDS

JLL Project and Development Services is a leader in the development, design, construction and branding of commercial real estate projects for the world’s
most prominent corporations, educational institutions, public jurisdictions, healthcare organizations, industrial facilities, retailers, hotels, sports facilities
and real estate owners. Our scope of services includes Project Management, Development Advisory/Development Management, Project Advisory, Project
Monitoring, Relocation Assistance & Construction Management (Design & Build Services). JLL India’s project management team comprises 1,300 project
managers across 300+ sites and is actively managing/managed and delivering an area of 267 million sq ft. PDS Industrial is a service line catering to large
Manufacturing & Warehousing facilities with an objective to breathe life and create a facility that works for your culture, people and community.
 JLL Manufacturing Services
We Handhold your investment from ‘Concept’ or location evaluation stage to the commercial
‘Operation’ of your manufacturing plant in India i.e. from Concept to Operation.

Target Analyse Transact Ascertain Develop

Operation
Concept

Commercial
From

Location Section Incentives & Tax Transaction Advisory Due Diligence Project Management

Operation of plant
Stages & Services

Business Location Incentive Appraisal Transaction of Legal DD Design Consultancy

Commercial
Advisory Incentive Govt. Land / Private EHS DD Project Management
Supply Chain Study Negotiation Land / Built Space
Liasoning etc Design & Build
Lease / Build Space
Tax Advisory Build / General Contractor
Lease to Buy

Core JLL Services Delivered by JLL or in consortium / partnership / sub-consultant with reputed international or national domain consultants
Note: This is just an indicative representation of scope and services. Actual services and phasing would vary and are customized for each project.

Advantage to an Investor / Manufacturer

• Integrated End to End • Interlinking of all the • Multi-Disciplinary • Opportunity to avail • Flexibility of
Services for manufacturing stages seamlessly for easy Team with Domain / services at whatever different fee
investments in India. and fast execution. Subject Matter Experts stage of the project desired models
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About JLL
JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for
a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our
clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $18.0 billion in 2019, operations in over 80 countries and
a global workforce of over 92,000 as of September 30, 2020. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For
further information, visit jll.com

About JLL India

JLL is India’s premier and largest professional services firm specialising in real estate. With an unaudited revenue in excess of 4,900 crores for FY 2019-20,
the Firm is growing from strength to strength in India for the past two decades. JLL India has an extensive presence across 10 major cities (Mumbai, Delhi
NCR, Bengaluru, Pune, Chennai, Hyderabad, Kolkata, Ahmedabad, Kochi and Coimbatore) and over 130 tier II & III markets with a cumulative strength of
close to 12,000 professionals.

The Firm provides investors, developers, local corporates and multinational companies with a comprehensive range of services. This includes leasing,
capital markets, research & advisory, transaction management, project development, facility management and property & asset management. These
services cover various asset classes such as commercial, industrial, warehouse and logistics, data centres, residential, retail, hospitality, healthcare, senior
living, and education. For further information, please visit jll.co.in
Authors Media enquiries
Chandranath Dey Deepraj Das Arundhati Bakshi Dighe
Head - Industrial Operations, Business Manager Lead - PR and
Development, Industrial Consulting & Industrial Service, Communication
PAGI, India, JLL India, JLL Arundhati.Dighe@ap.jll.com
Chandranath.Dey@ap.jll.com Deepraj.Das@ap.jll.com 

Acknowledgements
JLL India would like to take this opportunity to thank Invest India, the National Investment Promotion and Facilitation Agency of the Government of India, for their
sincere efforts to facilitate investments in India. We congratulate the entire team for being winners of the prestigious and globally acclaimed UNCTAD Investment
Promotion Award 2020. This report would not have been possible without credible inputs and suggestions from many people in Invest India.

Would also like to acknowledge the strategic and critical data inputs from Sujash Bera, Debashis Dutta, Shristy Singh, Sikhya Babu and Industrial City
Transaction Teams for on-ground transaction validation, technical updates and critical inputs.

Jones Lang LaSalle Property Consultants (India) Pvt Ltd © 2021. All rights reserved.
This report has been prepared solely for information purposes and does not necessarily purport to be a complete analysis of the topics discussed, which are inherently unpredictable. It has
been based on sources we believe to be reliable, but we have not independently verified those sources and we do not guarantee that the information in the report is accurate or complete.
Any views expressed in the report reflect our judgment at this date and are subject to change without notice. Statements that are forward looking involve known and unknown risks and
uncertainties that may cause future realities to be materially different from those implied by such forward-looking statements. Advice we give to clients in particular situations may differ from
the views expressed in this report. No investment or other business decisions should be made based solely on the views expressed in this report