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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.

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1. Introduction.- 2. Review of Select Studies.- 3. Empirical Analysis: Organized Manufacturing Sector (ASI Sector).- 4. Performance of Unorganised Manufacturing.- 5. Inter-industry Linkages.- 6. Productivity, Skills and Innovation.- 7. Innovation and Employment.- 8. Conclusions.

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Arup Mitra is a professor of Economics at the Institute of Economic Growth, New Delhi, India. His research interest includes issues in the area of development economics, urban development, labour and welfare, industrial productivity growth and employment, services sector growth and trade in services, and gender studies. He has published in a number of international and national journals. He worked as a senior researcher at ILO (Geneva), was offered visiting fellowship at Institute of Developing Economies (Tokyo) and held the Indian Economy Chair at Sciences Po. (Paris). The Indian Econometric Society offered him the Mahalanobis Memorial Gold Medal for his outstanding contribution in the field of quantitative economics. His work has been cited in the Handbook of Regional and Urban Economics (Elsevier, 2004) and he has also contributed in the Encyclopaedia of Life Support Systems (EOLSS), Mathematical Models in Economics (Ed. Zhang, W.), developed under the auspices of the UNESCO and in the

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