Manufacturing Sector in India: Key Players, Growth & Opportunities

Investment

Some of the major investments and developments in this sector in the recent past are:

• Driven by policy reforms, targeted incentives, and a renewed focus on cluster-based industrial development, India’s manufacturing sector is undergoing transformation. New hubs are emerging across states under flagship programmes like Make in India, Production Linked Incentive (PLI) schemes, and the expansion of industrial corridors. These Make in India manufacturing clusters—spanning electronics, semiconductors, pharmaceuticals, automobiles, textiles, and biomedical industries—are supported by robust infrastructure, skilled talent, and government facilitation.
• The spotlight is on the emerging manufacturing clusters in India 2025, which combine global investment interest with India’s domestic capacity-building agenda. From the electronics manufacturing corridors in Uttar Pradesh to the semiconductor zones in Gujarat and the nationwide PM MITRA textile parks, India’s industrial landscape is being reshaped. These seven ecosystems are set to become the foundation of India’s ascent as a global manufacturing powerhouse.
• Government-led infrastructure and logistics reforms are enabling manufacturing expansion through sustained investments in connectivity, industrial infrastructure, and planning systems.
• The PM GatiShakti initiative has transformed infrastructure planning through a unified platform integrating over 1,700 data layers across 57 ministries and departments. PM GatiShakti Public and the Unified Geospatial Interface now provide 230 datasets for investment and logistics planning. At the state level, 27 states have notified logistics policies, while 28 aspirational districts are utilising the District Master Plan Module for integrated development.
• Complementing this, the National Logistics Policy (NLP) is strengthening logistics integration through the Unified Logistics Interface Platform (ULIP), which connects 44 systems across 11 ministries, covering over 2,000 data fields, supporting 1,700+ companies, and enabling over 200 crore API transactions.
• Industrial corridor development is also progressing, with cities such as Dholera and Greater Noida emerging as key manufacturing hubs. Over 350 industrial plots have been allotted, supported by investments of Rs. 2.02 lakh crore (US$ 22.86 billion).
• These initiatives reflect a coordinated push to enhance manufacturing competitiveness, improve logistics efficiency, and support sustained manufacturing-led economic growth.
  • The Defense Acquisition Council, chaired by Union Minister of Defence Mr. Rajnath Singh, has approved Rs. 67,000 crore (US$ 7.65 billion) worth of projects to strengthen the Indian Army, Navy, and Air Force. The move focuses on boosting ‘Make in India’ with key roles for Hindustan Aeronautics Limited (HAL), Bharat Electronics Limited (BEL), and Bharat Dynamics Limited (BDL).
  • Under the "Make in India" initiative, the Marhowrah Diesel Locomotive Factory in Bihar is set to export 150 Evolution Series ES43ACmi locomotives to Guinea for its Simandou iron ore project. Developed in partnership with Wabtec, this export deal is valued at over Rs. 3,000 crore (US$ 345.9 million) and significantly expands India’s global footprint in railway manufacturing.
  • The Department for Promotion of Industry and Internal Trade (DPIIT) has signed a Memorandum of Understanding (MoU) with Electric Vehicle (EV) manufacturer Ather Energy on July 29, 2025, to foster growth and innovation within India’s EV and manufacturing startup ecosystem. This collaboration aims to provide strategic mentorship and infrastructure support to deep-tech startups engaged in the EV value chain, including areas such as battery technology, vehicle manufacturing, and clean energy solutions.
  • On July 30, 2025, Samsung, has signed a strategic Memorandum of Understanding (MoU) with Startup India, a flagship initiative of the Government of India. The collaboration aims to identify and nurture high-potential talent, especially from Tier II and Tier III cities, by providing access to infrastructure, expert guidance, market linkages, and funding opportunities.
  • In July 2025, Startup India has identified Wayanad as the next potential startup hub in Kerala, aiming to build a strong ecosystem for innovation and entrepreneurship in the region. This initiative is part of a broader effort by Startup India the Government of India's flagship program, to foster sustainable economic growth and generate employment opportunities through startups.
  • According to NITI Aayog report, India can potentially capture a larger global market share, targeting Rs. 2,13,925 crore (US$ 25 billion) in exports by 2035.
  • According to the Council for Leather Exports (CLE), India’s leather, non-leather footwear, and products exports increased by 25% at Rs. 48,667 crore (US$ 5.7 billion) in FY25, may hit Rs. 55,497 crore (US$ 6.5 billion) in FY26.
  • Global Capability Centres in India are estimated to create around 4.25–4.50 lakh new jobs in 2025 alone, with the total workforce reaching approximately 2.4 million professionals in 2025–26. The sector is projected to employ 2.8–3.5 million professionals by 2030.
  • India’s GCCs witnessed an 8–10% increase in hiring volumes in Q1 FY26, compared with a 3–6% decline in Q4 FY25. The manufacturing, automotive and energy sectors recorded the highest demand growth at 31% quarter-on-quarter, driven by increased investments in smart factories, Industrial Internet of Things (IIoT) and electric vehicle (EV) platforms.
  • The Department for Promotion of Industry and Internal Trade (DPIIT) has partnered with Hafele India to support manufacturing startups by promoting innovation, local sourcing, and global market integration, while providing mentorship, infrastructure, and ecosystem access via Startup India.
  • With Rs. 14,93,975 crore (US$ 175 billion) in funding and 76 IPOs in 2024, India is preparing for significant growth in the startup sector.
  • Shree Cement has signed a Memorandum of Understanding (MoU) with the Department for Promotion of Industry and Internal Trade (DPIIT) to support manufacturing sector startups by providing infrastructure, mentorship, funding access, and market connections, aiming to enhance India's manufacturing ecosystem and promote self-reliance through domestic innovation.
  • In FY2025-26, India's defence exports reached a record Rs. 38,424 crore (US$ 4.35 billion), registering a 62.70% increase year-on-year. The government aims to raise defence exports to Rs. 50,000 crore (US$ 5.71 billion) by 2029. This growth has been driven by both Defence Public Sector Undertakings, which saw a 42.85% export increase, and a strong private sector contribution.
  • Sansera Engineering Limited has signed an MoU with the Karnataka government to invest Rs. 2,100 crore (US$ 251 million) in a new manufacturing facility in Ramanagara, aiming to create 3,500 jobs and enhance production capacity in the automotive and non-automotive sectors over the next three to five years.
  • Google is set to begin manufacturing Pixel smartphones in India, specifically in Tamil Nadu, in collaboration with Foxconn and Dixon Technologies. This production aims to cater primarily to export markets in Europe and the US, with operations expected to start in September 2024. The initiative comes as Google prepares to launch its Pixel 9 series in India on August 13, leveraging India's Production-Linked Incentive (PLI) scheme to enhance manufacturing scalability.
  • Maruti Suzuki has begun exporting the Made-in-India Fronx compact SUV to Japan, marking its first SUV launch in the Japanese market. Manufactured at its Gujarat plant, the first shipment of over 1,600 vehicles has already left for Japan, with the official launch planned for autumn 2024.
  • India's first 'Made in India' chip is expected by December 2025, supported by the Rs. 76,000 crore (US$ 8.79 billion) Semicon India program. Foreign investments are also flowing in, with NXP Semiconductors planning to invest Rs. 8,644 crore (US$ 1 billion) in R&D and Micron Technology setting up a Rs. 23,771 crore (US$ 2.75 billion) plant in Gujarat. India's semiconductor market is projected to reach Rs. 5,44,572 crore (US$ 63 billion) by 2026.
  • According to Department for Promotion of Industry and Internal Trade (DPIIT), India received a total foreign direct investment (FDI) inflow of Rs. 4,03,251 crore (US$ 46.42 billion) in FY24. FDI.
• According to the White & Case, India ranked eight among the top recipients of Foreign Direct Investment (FDI) in the world in 2023. 100% FDI is approved in the sector through automatic route under the current FDI Policy. The Union Minister of Commerce and Industry, Mr. Piyush Goyal, highlighted significant progress in domestic manufacturing. Notably, around 99% of mobile phones sold in India are now manufactured domestically, supported by strong policy incentives and rising Foreign Direct Investment (FDI).
  • Cumulative FDI equity inflow (April 2000–December 2025) stood at Rs. 50,72,333 crore (US$ 776.76 billion).
  • Between January 2000 and March 2026:
  • The Automobile Industry received cumulative FDI equity inflows of Rs. 2,70,905.27 crore (US$ 40.47 billion).
  • The Chemicals (excluding fertilisers) sector received cumulative FDI equity inflows of Rs. 1,50,177.05 crore (US$ 24.07 billion).
  • The Drugs & Pharmaceuticals sector received cumulative FDI equity inflows of Rs. 1,59,280.15 crore (US$ 25.37 billion).
  • The Computer Software & Hardware sector received cumulative FDI equity inflows of Rs. 9,07,355.53 crore (US$ 124.67 billion).
  • Foreign Direct Investment (FDI) in India's manufacturing sector has surged nearly 69% over the past decade, reaching Rs. 14,34,224 crore (US$ 165.1 billion) accounting for around 21% of cumulative FDI inflows. This growth is largely attributed to production-linked incentive (PLI) schemes, which have driven significant investments and job creation.
  • India aims for Rs. 8,68,700 crore (US$ 100 billion) annual foreign direct investment (FDI) in the coming years, according to Union Minister of Information and Broadcasting, Mr. Ashwini Vaishnaw, as part of the government's strategy focused on infrastructure investment, social upliftment, manufacturing growth, and simplification of business processes, amidst projections of consistent 6-8% economic growth over the next decade.
• For the month of June 2025, the Quick Estimates of Industrial Production (IIP) with base 2011-12 stands at 153.3. The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of June 2025 stand at 123.2, 152.3, and 217.1, respectively.
• In FY2025-26, the Index of Industrial Production (IIP) for the manufacturing sector grew by 4.90%, reflecting sustained expansion in manufacturing activity during the year under the revised 2022-23 base year series.
• The Index of Industrial Production (IIP), compiled by the Ministry of Statistics and Programme Implementation (MoSPI), measures industrial activity across the mining, manufacturing and electricity sectors, with manufacturing accounting for 77.63% of the overall index (base year: 2011-12). Over the past decade, the manufacturing sector has remained the key driver of industrial production, while mining and electricity have also contributed to overall industrial growth.
• Industrial production witnessed a strong rebound in 2021-22, with the General IIP recording its highest annual growth of 11.4%, driven by robust growth in manufacturing (11.8%), mining (12.2%) and electricity (7.9%) following the pandemic-induced contraction in 2020-21. In 2025-26, industrial activity remained positive, with the General IIP growing by 4.1%, supported by manufacturing (5.0%), mining (1.4%) and electricity (1.0%), indicating continued expansion across key industrial sectors despite a moderation in growth compared with previous years
• As per the Use-Based Classification, the indices stood at 119.6 for Primary Goods, 135.3 for Capital Goods, 123.1 for Intermediate Goods and 130.8 for Infrastructure/Construction Goods in May 2026. Further, the indices for Consumer Durables and Consumer Non-durables stood at 120.4 and 118.4, respectively.
• In FY2025-26, capacity utilisation in the manufacturing sector, as measured by the Reserve Bank of India's Order Books, Inventories and Capacity Utilisation Survey (OBICUS), increased from 74.10% in Q1 to 74.30% in Q2 and further to 75.60% in Q3, indicating sustained improvement in manufacturing activity and production capacity utilisation.
• Forward-looking indicators continue to reflect optimism in India’s industrial sector, with the manufacturing Purchasing Managers’ Index (PMI) remaining firmly in expansion zone (well above the 50 mark) since March 2023. In January 2026, PMI stood at 55.4, above its long-run average, indicating continued improvement in the sector’s health.
• In March 2026, the Government promoted global collaborations in aerospace manufacturing, highlighting joint ventures with international companies such as Embraer and Sukhoi to establish manufacturing facilities and strengthen India's aerospace production capabilities.
• In May 2025, the Employees' Provident Fund Organisation (EPFO) added a net total of 20.06 lakh members, which is the highest recorded addition since data tracking began in April 2018, marking a 2.84% YoY growth with 9.42 lakh new members enrolled, largely driven by increased employment opportunities and effective outreach initiatives. Notably, the 18-25 age group accounted for 59.48% of the total new subscribers, adding 5.60 lakh new subscribers. Female membership also saw significant growth, with 2.62 lakh new female subscribers joining, marking a 5.84% YoY growth compared to May 2024, and indicating a shift towards a more inclusive workforce.
• In December 2025, GIGABYTE Technology commenced local production of motherboards in India through a contract manufacturing partnership, supporting the Make in India initiative, reducing import dependence and strengthening the country's electronics manufacturing ecosystem.
• Amazon Inc’s cloud computing division, Amazon Web Services, became the latest company to invest in India. The company has planned to invest Rs. 1,12,931 crore (US$ 13 billion) in India by 2030 to build its cloud infrastructure and create thousands of jobs.
• On February 29, 2024, India approved the construction of three semiconductor plants with investments exceeding Rs. 1,30,305 crore (US$ 15 billion). These plants aim to establish India as a major chip hub, with Tata Electronics, Tata Semiconductor Assembly and Test Pvt Ltd, and CG Power spearheading the projects in Gujarat and Assam. This initiative aligns with India's goal to bolster its semiconductor ecosystem and create numerous advanced technology jobs.