Despite witnessing a decade of rapid economic growth, an acceleration of growth in
the organised manufacturing sector has eluded India. Using data from the Annual Survey of
Industries, we examine the factors holding back the growth of output and employment in this
sector. We find that there are heterogeneities in the performance of the manufacturing sector
across industries and states. Recent economic growth has benefited industries which rely
more on capital and skilled workers as opposed to unskilled/low skilled workers.