According to theprint.in, a new report released by the NITI Aayog identifies twelve key manufacturing sectors where India can expand its global footprint, aiming to reverse decades of stagnant market share growth compared to China.
Stagnant Market Share vs China’s Dominance
India’s share in global manufacturing value grew from about 1.5 percent in 1995 to only 3.2 percent in 2023. In contrast, China’s share increased from about 5 percent to nearly 32 percent during the same period.
The report, titled ‘Key sectors to Position India as a Global Manufacturing Hub Volume-1’, noted that India’s manufacturing sector accounts for 17.5 percent of its gross value added (GVA). This share has remained broadly stagnant at around 16-18 percent for the past two decades.
NITI Aayog Vice Chairman Ashok Kumar Lahiri emphasized the urgency of the situation at the report launch. “It’s about building productive capacity, increasing productivity, improving competitiveness and expanding India’s presence in global markets,” Lahiri said.
Twelve Priority Sectors Identified
NITI Aayog, in collaboration with Crisil Intelligence, assessed 62 manufacturing sectors and identified 12 with the potential to help India emerge as a global leader. The identified sectors include automobiles, chemicals, capital goods, electronics, pharmaceuticals, defence and drones, food processing, textiles, steel, leather and footwear, telecom equipment, and solar PV manufacturing.
The first volume of the study examines four of these sectors in detail: chemicals, textiles, telecom and network equipment, and solar PV manufacturing. The remaining eight sectors will be covered in subsequent volumes.
Chemicals and Textiles Show Promise
Chemicals offer significant room for expansion as global supply chains diversify away from China. India only accounts for about 8 percent of the major import market in 2024, while domestic chemical consumption is projected to reach USD 290-310 billion by FY 2030.
The report says India needs chemical production to grow about 14 percent annually to capture this opportunity. The textile sector offers another major opportunity because of their employment intensity and established manufacturing base.
India is the sixth-largest textile and apparel exporter, with a 4.1 percent share of global exports in 2024. However, the report says improving productivity, scaling up man-made fibre production, modernising micro-small and medium enterprises (MSMEs) and expanding market access will be critical.
Telecom and Solar PV Gaps
Telecom equipment gives India a strategic opportunity with the rising demand from 5G and digital infrastructure. But India’s exports were only USD 0.6-1 billion annually between 2020 and 2024, compared with imports of USD 4-5 billion.
With more than 80 percent of critical components sourced from China, the report recommends greater localisation of component manufacturing, technology transfer, joint ventures and industrial clusters.
Solar PV manufacturing has also emerged as a fast-growing opportunity for India. Module manufacturing capacity rose to 100 gigawatts (GW) in August 2025 from 2.3 GW in 2014, while cell manufacturing capacity increased to 25 GW from less than 1.2 GW.
The report said rising solar installations will create strong domestic demand, but India needs to strengthen its domestic manufacturing ecosystem to compete globally.
Overcoming Structural Hurdles
Across sectors, the report identifies import dependence, fragmented supply chains, infrastructure and logistics gaps, limited domestic value addition, technology constraints and skill shortages as key hurdles.
It says India must move beyond “assembly-led or low-value manufacturing” and towards deeper participation in global value chains. According to NITI Aayog, addressing these problems is essential to help Indian companies grow and compete globally.
The report recommends better infrastructure, manufacturing clusters, investment in technology and skill development, and easier access to global markets. Lahiri said the government’s role was to remove the hurdles that prevent businesses from investing and expanding. “We must diagnose the problem and solve it.”
Source: theprint.in
Compiled from international media by the SCI.AI editorial team.
