Impact of Industrial Policy Reforms on Productivity and Employment Generation: A Sector-Wise Panel Data Analysis of Indian Manufacturing Industries

This study examines the impact of industrial policy reforms on productivity and employment generation across major manufacturing sectors in India using a panel data approach. Drawing on sector-level data from the Annual Survey of Industries (ASI) for the period 2000–01 to 2022–23, the analysis investigates how deregulation, trade liberalization, and investment policies have influenced industrial performance. Fixed effects and random effects models are employed to capture sector-specific heterogeneity. The results indicate that industrial reforms have significantly improved labor productivity across sectors, while employment generation has remained uneven and concentrated in labor-intensive industries. The findings highlight the need for sector-specific industrial policies that balance productivity growth with employment creation.