Rural unorganised manufacturing industries in Assam: Some aspects of growth, structural change and productivity

Abstract

The present paper aims to analyse the performance of the rural unorganised manufacturing industries in Assam in the post-reform period. The analysis has brought out that the rural unorganised manufacturing industries in Assam have been undergoing considerable structural changes over time; the most domineering household-based enterprise segment, i.e., OAMEs, has been losing its share, in favour of the establishments. At the industry level, however, the preponderance of the agro-based group of industries such as food and beverages, textiles, and wood products remained untouched. Over time, the rural unorganised manufacturing industries have been deteriorating; output growth has been decelerating, while growth in the number of enterprises and employment has been negative during 1994-95/2010-11. The setback in the rural OAMEs has the onus of this deceleration; otherwise, the rural establishments witnessed a decent growth. Across industry groups, most of the industries have achieved a decent output growth at varying rates, whereas majority of the industries witnessed a considerable decline in the number of enterprises and employment. The consequences of such a pattern of job-loss growth are quite high growth in labour productivity and negative employment elasticity across industry groups. The paper emphasises the need for provisioning of training facilities leading to skill development, access to credit and market facilities, undisrupted power supply, technology support, agricultural growth, and strong linkages between unorganised and organised enterprises, among others, for the growth of rural unorganised manufacturing in the State.