The book explores for India and other developing countries the potential role the organized
manufacturing sector could play as an engine of growth. Alongside growth can this sector
generate adequate employment opportunities to facilitate the transfer of labour from the
agriculture sector? The book identifies the major constraints that result in limited demand for
labour in the organised manufacturing sector. Beyond technological aspects skill shortage is
an important factor resulting in sluggish labour absorption. Further the labour market laws
are not necessarily the root cause of sluggish employment growth in the organised manufacturing
sector. The development of technologies that are appropriate for labour surplus countries like
India is instrumental to employment creation. Though innovation is generally assumed to be
capital-intensive in nature the book argues that innovation nevertheless has a positive effect
on employment in absolute terms. Lastly the main policy issues are highlighted in terms of the
priority that should be assigned to industries which can contribute to employment growth and
skill formation for improving the employability of the available labour force and to which
innovations should be pursued with a specific focus on pro-poor growth objectives.
