India's manufacturing hubs
Factories in India are concentrated regionally. While food products, textile and apparel are the biggest employers, the manufacture of metals drives value added. Each of these industries has its own regional hubs.
Manufacturing in India takes place both in organised factories as well as through unorganised units. Organised manufacturing accounts for the majority of economic value added through manufacturing[1] and employed 18.5 million people in over 200,000 factories in 2024.[2] In this piece, we look at the distribution of factories and organised manufacturing in Indian states.
Half of India's factories are concentrated in just five states - Tamil Nadu, Gujarat, Maharashtra, Uttar Pradesh and Karnataka. The share of manufacturing in a state's economy also varies significantly among states, from making up less than 1% of the Gross Value Added (GVA) in Mizoram to 35% in Gujarat.[3]
Manufacturing employment hubs
The manufacture of food products is the industry that employs the most Indian factory workers, accounting for over two million jobs. The manufacture of textiles and wearing apparel is another key source of factory jobs, collectively employing over three million people.
The manufacture of food products is widely dispersed throughout the country, with Maharashtra being the leading employer. Tamil Nadu followed by Gujarat are India's textile manufacturing hubs, while Tamil Nadu is India's apparel manufacturing hub, with more than one in three apparel factory workers in the state alone. Tamil Nadu is also the hub of computer and electronics manufacturing workers, followed by Uttar Pradesh.
The manufacture of basic metals is largely confined to the mineral-rich states of Odisha, Chhattisgarh and West Bengal, as well as Maharashtra and Gujarat. Most of India's tobacco manufacturing workers, meanwhile, are in one state alone - Telangana - which is home to two in three workers in this sector.
Manufacturing value hubs
Factories that employ the most people are not always those that produce the most economic value, measured in terms of Gross Value Added.[4]
The manufacture of basic metals - which includes the production of iron and steel from ore, manufacture of copper, chrome and lead - is the highest contributor to GVA from manufacturing, adding about Rs 250 billion (11% of aggregate GVA from manufacturing) in value in 2023, but is the third highest in employment generation.
Chemical and chemical product manufacturing, which added Rs 210 billion in value in 2023 (9% of the GVA from organised manufacturing) employed one million people.
The manufacture of coke and refined petroleum products is the third largest contributor to value added from organised manufacturing, adding Rs 190 billion in value, but employs less than 1% of factory workers.
The factory groups that produce the highest economic value are concentrated in a few states, which are not those with the most factories or the most factory employment.
Basic metals activity is concentrated in Odisha, Maharashtra, Chhattisgarh, Gujarat and West Bengal, while the chemicals industry is concentrated in Gujarat, Maharashtra and Tamil Nadu. The manufacture of coke and refined petroleum products is concentrated in Gujarat and Maharashtra.
The manufacture of vehicles, mainly in Tamil Nadu, Maharashtra and Haryana, and the manufacture of pharmaceuticals, concentrated in Gujarat, Maharashtra and Himachal Pradesh, are the next biggest contributors to economic value from organised manufacturing.
(Ishan Deodhar was a research intern with Data For India.)
[1] Provisional estimates of gross domestic product (2024-24), National Statistics Office.
[2] Provisional estimates of national income (2022-23), National Statistics Office.
[3] Summary results, Annual Survey of Industries 2022-2023, Ministry of Statistics and Programme Implementation.
[4] Gross Value Added is a key economic indicator of a factory (also of the economy as a whole) and is defined as the value of products produced in the factory (output) minus the value of goods used to produce them (input).
