Even as average investments in fixed assets, like land, plant & machinery, transport equipment etc. of unregistered manufacturing units more than doubled over the past decade to Rs 58,166 per unit in 2005-06, there was a large disparity across states.
While Delhi topped all the states with the market value of the average investment per unit touching Rs 2.97 lakh, Orissa was at the bottom of the list with the average market value of the investment per unit at only Rs 14,040.
While 12 of the 35 states and Union territories have investments with market value of above a lakh of rupees, their value in another 10 states ranged between Rs 50,000 and a lakh, according to the recent National Sample Survey report on Unorganised Manufacturing Sector in India, 62nd round, which covered 82,897 enterprises employing about over 3 crore persons across the country.
One reason for the significant disparity in the market value of investments in the unregistered manufacturing sector was the differences in the value of investments in land and buildings. NSSO numbers show that in most states where the average market value of the investment was among the highest, were also the states where investment in land was the highest.
Also, there was significant variation in allocations across various categories of fixed investments. For instance, the share of land and buildings was more than three-fourth of the market value of investments in 10 states, while this share came down to less than half in four states. Such significant diversity was also visible in the case of the share of machinery and equipment in the total market value of fixed investments. While machinery and equipment accounted for more than a third of the market value of investments in three states and Union territories, its share ranged between 10-20% in 15 states and Union territories.
Fixed assets are defined as assets that are used to produce or provide goods and services and are not for resale. These include land and building, plant and machinery, equipment etc.