Meerut GDP 2027


  1. Meerut is relatively more urban centric in Uttar Pradesh and industry has been important sector of economy. Overall share of industry comprising mining, manufacturing, electricity & utilities and construction together have a share of 36.5 per cent compared to a share of 23.8 per cent for Uttar Pradesh and 25.1 per cent at national level. Within industry, manufacturing and construction are the dominant sectors. Overall gross value added from industry and its share in total value added from this sector in Uttar Pradesh is summarized in Table 16 below. Medium term growth of the secondary sector of Meerut has been lower than that of Uttar Pradesh resulting in a decline in its share from 4.5 per cent in 2011-12 to4.31 percent in 2020-21.

Table 16: Gross Value added from Industry and its sub sectors (Rs crore)

2011-12 2017-18 2018-19 2019-20 2020-21 CAGR
Mining and quarrying 53 123 34 27 25 (8.0)
Manufacturing 2,582 5,647 5,230 4,511 4,299 5.8
Electricity & utility services 284 1,048 1,080 1,364 1,493 20.2
Construction 5,957 9,450 10,674 11,369 11,035 7.1
Industry 8,876 16,269 17,017 17,271 16,852 7.4
Uttar Pradesh 188,316 370,860 391,141 407,052 390,627 8.4
Share of Meerut (per cent) 4.50 4.39 4.35 4.24 4.31

[Source: Directorate of Economics & Statistics, Uttar Pradesh]

  1. Within industry, manufacturing is the most vibrant sector. Manufacturing comprises organized manufacturing, the units covered under Annual Survey of Industries employing 10 or more workers and unorganized employing less than 10 persons.

Table 17 : Annual Survey of Industries- A snapshot (Invested Capital & Output in Crores and Persons in numbers)

           2018-19    2011-12    CAGR
Invested capital Output Persons employed Invested capital Output Persons employed lnvested capital Output
Food Products 3,900 8,022 7,081 2,084 2,924 8,619 9.4 15.5
Beverages 177 395 540 97 175 755 9.0 12.3
Textile & Apparels 583 1,116 5,412 472 682 3,123 3.1 7.3
Paper & products 1,230 3,650 4,870 882 792 1,450 4.9 24.4
Chemical & Pharmaceuticals 616 2,007 4,954 305 929 3,658 10.6 11.6
Rubber & Plastic Products 793 1,381 3,687 216 651 3,030 20.4 11.3
Basic & Fabricated Metals 178 461 1,639 68 280 681 14.9 7.4
Machinery & Equipment 164 559 1,631 142 335 1,868 2.1 7.6
Transport Related 149 156 1015 164 60 549 1.4 14.6
Sports Goods 344 875 6,554 123 292 2,746 15.9 17.0
Others 496 479 3,975 152 107 19,302 18.3 23.9
Total factory sector 8,631 19,102 41,358 4,705 7,227 45,781 9.1 14.9

  1. The latestASI data for Meerut are available for 2018-19. Between 2011-12 and 2018-19, there has been a small increase of 30 units in number of factories from 625 to 658. Invested capital and output during this period, however has doubled (Table 17). Surprisingly, there has been a decline in number of persons engaged in factory sector. The industries which have witnessed an increase in number of persons engaged are sports goods, textiles & apparels, paper, chemicals, rubber and metals. The other industries, which include leather, furniture, gems & jewellery seems to have witnessed an employment reduction in 2018-19. Gross value added from organized manufacturing in 2018-19 at Rs. 2658 crore was just around 50 per cent of total value added from manufacturing. In 2011-12 also the share of organized sector in value added from manufacturing was close to 50 per cent. The ratio of value added to output was sticky at 14-15 percent during this period.

  2. The small-scale industry has indicated existence of over 47,000 establishments in micro, medium and small-scale sector in manufacturing, trade and services sector in Meerut in 2017-18. The sector wise numbers are as in Table 18.

Table 18: Number of Micro, Small and Medium Enterprises in Meerut

Sectors Numbers Sectors Numbers
Manufacturing Food products 3172 Trade (Wholesale & Retail) 7085
Sports Goods 3946 Education & Culture 1199
Textiles & Apparels 3804 Health 573
Computer, electronic and optical products 259 Transport and Services Related 4278
Rubber and plastics products 596 Personal Services 1882
Leather and related products 329 Food & Catering Services 1747
Paper and paper products 484 Construction 2442
Electrical equipment 815 Civic Amenities 523
Chemicals and chemical products 679 Others 9513
Machinery, Metals & equipment 1308
Other Manufacturing 2412 Total 47046

[Source: District Industries Centre, Meerut]

  1. Government of Uttar Pradesh had conducted a survey of unorganized units in manufacturing sector in 2017. Number of units. MSME units in Meerutwere relatively bigger.

Table 19 : MSME- A Snapshot

Meerut Uttar Pradesh Share
No of Enterprises 7881 163,319 4.83
Workers 59,710 1,310,194 4.56
Fixed Assets (Rs Crore) 2,220 62,513 3.55
Loans (Rs crore) 259 17,284 1.50
Output (Rs crore) 1,188 15,511 7.66
GVA (Rs crore) 684 9,462 7.23
GVA per unit (Rs) 868,212 579,383

[Source: Directorate of Economics & Statistics- Unorganized Sector Survey]

  1. Data on employment in manufacturing is significantly different when compared across the source agencies. The populating census data gives a number of around 77,000 for household industries. Unorganized manufacturing survey gives a number of 59,000. The establishment and number of persons based on other survey gives a number of a little over one lakh for manufacturing. However, based on these and given the manufacturing base in the district, one can take that manufacturing in Meerut may be employing around one lakh persons and total employment in industrial sector could be somewhere between 2 to 2.5 lakhs. Construction is the single largest sector in Meerut accounting for 25 per cent of gross value added. It has been a buoyant sector with preliminary skill needs and as such would perhaps be employing more than one lakh persons.

Table 20 : Establishments and Employment in Industry in 2013

Sector Rural Urban Total Rural Urban Total
Number of Establishments/ Own Account Units Number of Persons Engaged
Total Industry 12993 28310 41303 35761 79198 114959
Uttar Pradesh 653,335 581,004 1,234,339 1,557,558 1,950,129 3,507,687
Share 2.0 4.9 3.3 2.3 4.1 3.3

[Source: Uttar Pradesh- District Fact Book: India state Publications 2022]

  1. The Uttar Pradesh government launched its Industrial Investment and Employment Promotion Policy 2022 in November 2022 to enable the state's air of becoming a one trillion-dollar economy. With the Up Global Investors Summit 2023 at sight, the state passed the new umbrella policy of the State.

• The policy aims at creating a progressive, innovative, and competitive industrial ecosystem generating employment in the state while mobilizing investments from across the world.
• Ensuring a continuity of the successes of Industrial Investment and Employment Promotion Policy 2017, the new umbrella industrial policy of the State reflects the voice of industries of the State & the country.
• Offering a unique flexibility to the investors by extending a one-time choice of choosing an option amongst three 'mutually-exclusive' options of Investment Promotion Subsidy, Capital Subsidy and Net SGST reimbursement, the policy categorizes investments into four major categories Large, Mega, Super Mega and Ultra Mega.
• With India at a bright spot in the global economy today, the policy is an excellent offering for foreign as well domestic investors. It complements as well as supplements various schemes and policies of the Centre to offer one of the most attractive and optimal incentive packages for investments in the country (Box 7)

                                                                                                 Box 7 : Industrial Incentives
• Stamp Duty: 75 percent in Madhyanchal & Paschimanchal.
• EPF Reimbursement: to the extent of 50% of employer's contribution to the units providing direct employment to 100 or more unskilled workers.
• SGST Reimbursement: Net SGST reimbursement ranging from 60 per cent to 90 per cent based on scale of industries.
• Capital Interest Subsidy: 5 per cent per annum for 5 years.
• Infrastructure Interest Subsidy: 5 per cent per annum for 5 years.
• Industrial Quality Development: 5 per cent per annum for 5 years.
• Electricity Duty: 100 per cent exemption to all new industrial units for 10 years.
• Mandi Fee: 100 per cent exemption to all new food processing units on purchase of raw material for 5 years.
• lncentivising employment generation: Units generating minimum employment of 200 direct workers will be provided 10 per cent additional EPF reimbursement.

  1. During pandemic in 2020-21, a stimulus package announced for MSME sector has the following components:
    • Collateral free loan of Rs 3 lakh crores to restart work and save jobs.
    • Subordinate debt provision of Rs 20,000 crore for 2 lakhs stressed MSMEs. Besides, there will be Rs 50,000 crore equity infusion and a fund of funds with corpus of Rs 10,000 crore to help these units expand capacity and help them list.
    • The Central Government and PSUs will clear all MSME receivables in next 45 days.
    • An interest subvention of 2 per for Mudra/Shishu loans up to Rs 50,000.
    • Special scheme for street vendors to provide Rs. 10,000 of working capital.
                                                                         Box 8 : Industrial Infrastructure in Meerut : Challenges
Uttar Pradesh has a mechanism of Udyog Sandhu. It is an organization of the State dedicated to facilitate Investment in Industrial and Service Sectors, besides solving various problems of existing & up-coming industries as well, related to different Government departments. It is a systemic process of by which the state administration engages with local industry associations. Problems are raised, recorded and endeavoured to be resolved by the district administration and at the Division level. Just a cursory glance of problems/ issues raised gives a vivid picture. The last three meetings organized in 2023 have the common issues :
• Problems related to poor condition of internal roads in approved industrial areas.
• Non-functional street lights and poor maintenance.
• Poor alignment of NHAI roads/ projects with PWD/ Municipal/ MDA roads leading disjointed patches and cragged connectivity.
• Lack of regular cleaning of street/ roads leading to dust accumulation & severe air pollution.
• Water drainage issues inside and outside industrial areas leading to water logging.
• House Tax accounting/fixation issues.
• Connection of smaller industries in many industrial areas with rural feeder instead of industrial feeder.
• Permanent and temporary encroachment {through weekly markets) of main roads leading to disruption in vehicular movement and in some cases drainage.
• The institution of Udyog Sandhu has not been effective to address the problems of industries.

  1. With two thirds of the enterprises being unregistered and more than half of the registered enterprises not seeking institutional credit support, these bailout packages were of limited significance. There are usually three biases in any bailout package, first it covers the units which are easily reachable (road side bias), second, the units with which the institutions or authorities are familiar (nearness bias) and thirdly the units which are relatively more resilient (have greater immunity) or (bias of the comfort) and these do not even bring the most vulnerable ones into any reckoning of bailout packages.

  2. Though the provisioning for basic facilities such as land, labor and capital is listed as the last in the list, they become the necessary and a very important role played by Government. However, that is not the sufficient condition. The type of institutions required to increase the competitiveness of the cluster are:

  1. An entrepreneur is a catalyst for economic development, a change agent with vision and creativity. Potential entrepreneurship development requires to be supported by a business ecosystem that is conducive to its emergence, easy finance, expertise, infrastructure, skills and a high level of motivation for change. Government of Uttar Pradesh has conceived an Integrated Business Development, which integrates various government schemes, provides integrated business development services, handholding of MSMEs starting from registration to promotion of their product/service in a competitive landscape and networking of entrepreneurs. The export promotion policy conceives of providing necessary export-related assistance and services in key focus areas of handicrafts, agriculture and processed food products, engineering goods, handloom and textile, leather products, carpets and rugs, glass and ceramic products, wood products, sports goods, defence products, services sectors covering education, tourism, IT and ITES, medical value travels and logistics. The scheme offers funding for participation in international fairs, study tours abroad, trade delegations, publicity, etc. Knowledge is now the key driver of growth.
                                                      Box 9 : Sources of Knowledge Using and Changing Capacities                                                                                                  
Sources of increasing knowledge using capabilities Sources of increasing knowledge changing capabilities
  Intra Firm Sources * Learning by doing
* Improved process & practices derived from trial and error
* Learning by changing
* Absorption and adoption of changing technologies
  Intra Cluster Sources * Cluster mobility of skilled labour
* Knowledge spillovers and diffusion between producers
* Knowledge spill over between suppliers, production related activities
* Creative collaboration between firms
* Training and skill development through cluster based initiatives
* Collaboration between entrepreneurs in clusters
* Association between stakeholders
  Sources Outside Cluster * Externally linked technical advantages
* Customers' and traders' knowledge
* Machinery and input suppliers
* Understanding testing needs and use of facilities
* Availability and use of factoring services

  1. Meerut has widespread industrial spectrum and each sector has their unique concerns, strategy and development targets. Each sector has different expectations. While generalisation does help in policy formulation, it is appropriate that industry specific concerns are taken note of. The involvement of stakeholders and understanding their concerns is equally important as what is being delivered. After all, it is these industries and entrepreneurs who would not only push the growth and facilitate getting to the target. They are both the contributors and beneficiaries of the growth process. For the study, discussions were held with representatives of major industry and services segments. We will look at the concerns and expectations of each important industry in Meerut.

  2. For many of the issues raised by Industry, industrial park or an industrial could be an answer. A typical cluster could be turning point for excellence in production, inter firm learning, technology upgradation, labour mobility beside being articulating common concerns more effectively (Box 10).

Box 10 : A Typical Cluster
Benefits from Central Government schemes Can avail State subsidies through awareness and association
Conglomerate of Producers, Input Suppliers and Traders
Suppliers/ Dealers Direct Production Supporting Trade
Machinery Producing Units Export Producers International Agents
Raw Materials Export Traders
Intermediate Inputs Supporting Units Domestic Suppliers Surplus/Defective Pieces
Packing Material Ancillary Units Whole sellers
Supporting Infrastructure
Industry Associations Skill/ Education Banking/Logistics
MDA Industrial Institution Labour Employability Banks Transport/Freight

  1. The industry specific analysis, however, leads to three interesting observations. First, the employment in manufacturing sector is significantly higher than what the other data sources tell. Most of these workers operate from home and may have not surfaced in official data. Second, the industry is scattered and unorganised to a significant extent and an innovative approach could only improve their conditions. Finance, technology, marketing and recognition are their common problems. A fixed location cluster may not be an answer to their concerns. Third, while these industries are to an extent vocal, they have not been able to articulate their concerns effectively. These industries have significant potential and also non-farm employment source with possibility of a significant increase in female labour force participation. Further since they are outside the LFPR and workers, their GDP contribution may perhaps be underestimated.

  2. While skill development and training (including the craftsmen training) has been recognised as a necessary input, their accessibility is still an issue. Further, training and placement are two sides of the coin and without placement, only the unutilized potential will be created. In PM Kaushal Vikas Yojana and the Craftsman Training, placement record is not satisfactory. Industry Associations' involvement, regular updating of course design and continuous research on skill sets that are in demand are essential ingredients.

  3. While traditional industries are needed to be nurtured, there is tremendous scope for new set of industries in the district. The digital technology has changed the environment and eco system of manufacturing. It is kind of destructive construction and it needs to be recognised upfront. There are four areas where there is additional scope of green field investment. In case of Meerut, with somewhat innovative workforce such transition and adoption of new emerging industries/sectors is less difficult.

  4. Government of India, along with Make in India has also introduced a scheme of product linked incentives. State Government has also identified Sports Goods and Textiles as the two industries as part of One District One Product. These are innovative schemes and entrepreneurs need to inform of the opportunities that these schemes offer.

                                                               Box 11 : The Production Linked Incentive Scheme - March 2020
This scheme was introduced to reduce India's dependence foreign countries It supports the labor-intensive sectors and aims to increase the employment ratio in India.
This scheme works to reduce down the import bills and boost up domestic production.
It invites foreign companies to set up their units in India & encourages enterprises to scale up.
The incentives, calculated on the basis of incremental sales, range from as low as 1% for the electronics and technology products to as high as 20% for the manufacturing of critical key starting drugs and certain drug intermediaries.
So far, the government has announced PLI schemes for 14 sectors including automobile and auto components, electronics and IT hardware, telecom, pharmaceuticals, solar modules, metals and mining, textiles and apparel, white goods, drones, medical devices and advanced chemistry cell batteries.