Top 5 Sectors Powering India’s Manufacturing India 2035: Growth Drivers, Statistics and Market Insights
RELEASE DATE: Jul 2025 Author: Spherical InsightsRequest Free Sample Speak to Analyst
India's manufacturing sector is quickly becoming one of the most dynamic forces behind economic change, changing the countrys place in international supply chains. India's youthful labor, sizable domestic market, and robust regulatory support are making it a desirable alternative to China in the face of growing demand for high quality, reasonably priced production. In sectors including automotive, electronics, textiles, and pharmaceuticals, the use of modern manufacturing technologies like automation, IoT, robotics, and smart factory systems is growing faster. With the help of encouraging government initiatives like Make in India and the Production Linked Incentive (PLI) programs, India's manufacturing sector is undergoing a strong comeback as multinational manufacturers look for resilience and diversification in the wake of geopolitical tensions and post-pandemic disruptions.
India's manufacturing market is growing quickly because it is used in a wide range of industries, from consumer durables and electric vehicles to heavy industries and precision engineering. Digital revolution is also redefining the sector; Industry 4.0 is bringing about increased operational sustainability, flexibility, and efficiency. Increased exports, MSME participation, and significant international and local investments have all contributed to the development of a favorable climate for scalable growth. Further accelerating this momentum are India's talent development programs, infrastructure improvements, and strategic alliances with international firms. The next wave of global manufacturing innovation is expected to be led by India as the globe shifts to smart, decentralized, and tech-integrated production processes.
Market Overview and Current Scenario:
According to a research report published by Spherical Insights & Consulting, the India Manufacturing Market Size is expected to grow from USD 1.41 trillion in 2024 to USD 2.98 trillion by 2035, at a CAGR of 7.04% during the forecast period 2025-2035. India is seeing a surge of domestic investment never seen before, which highlights the increasing trust in its manufacturing sector. Remarkably, domestic investment announcements increased by approximately 270% in just three years, from RS 10 lakh crore (USD115.69 billion) in FY21 to RS 37 lakh crore (USD 428.04 billion) in FY23–FY24. This sharp increase shows that investor sentiment has significantly improved as a result of structural reforms, government-led programs like Make in India and Atmanirbhar Bharat, and the successful application of Production Linked Incentive (PLI) programs in a number of industries. Even more encouraging is the fact that India has already received RS 32 lakh crore (USD 370.20 billion) in fresh domestic investment proposals in just the first nine months of FY25.
This quick investment rate, even before the fiscal year ends, indicates a great deal of hope and long-term dedication from both public and private sector projects. In the post-pandemic, China+1 age, it also emphasizes how appealing India is becoming as a dependable manufacturing base, providing not only scale and cost-efficiency but also policy certainty and a trained workforce. It is anticipated that these strong domestic investment trends will strengthen key industrial sectors like electronics, textiles, chemicals, semiconductors, autos, and renewable energy equipment, as well as generate millions of jobs and increase India's competitiveness in international supply chains.
India Manufacturing Market Size & Statistics
- The market for India Manufacturing was estimated to be worth USD 1.41 trillion in 2024.
- The market is going to expand at a CAGR of 7.04% between 2025 and 2035.
- The India Manufacturing Market is anticipated to reach USD 2.98 trillion by 2035.
Prospects for India's Manufacturing Economy: A Path to $1 Trillion
The Indian Brand Equity Foundation (IBEF) projects that by FY26, the country's manufacturing industry will have grown to RS 87.57 lakh crore (USD 1 trillion). Industrial giants like Gujarat, Maharashtra, and Tamil Nadu are driving this boom by quickly growing their capacities in the automotive, electronics, and textile sectors. India is a desirable location for both domestic and foreign manufacturers due to its enhanced ease of doing business, growing domestic consumption, and advantageous demographic dividend. By drawing foreign direct investment (FDI), improving industrial infrastructure, and encouraging technology-led innovation, strategic government programs like Make in India, Atmanirbhar Bharat, and the Production Linked Incentive (PLI) schemes are speeding up this progress. India is in a unique position to become the next global manufacturing powerhouse, with unparalleled scalability and long-term investment potential, due to growing governmental focus on value-added manufacturing, talent development, and export competitiveness.
Top 5 Sectors Powering India’s Manufacturing Boom
1. Pharmaceuticals – India’s Pillar of Global Healthcare
India's pharmaceutical sector, which ranks third in the world by volume and thirteenth by value, is a vital component of the global healthcare ecosystem. The nation manufactures more than 60,000 generic medications in 60 therapeutic categories, with over 3,000 pharmaceutical businesses and 10,500+ manufacturing facilities. India supplies 50% of the world's vaccinations, meets more than 40% of US demand, and exports 20% of the world's generics. India exported $25.3 billion worth of pharmaceutical products in FY23 alone. The India pharmaceutical market is expected to grow from USD 60.96 billion in 2024 to USD 197.13 billion by 2035, at a CAGR of 11.26% during the forecast period 2025-2035, propelled by favorable regulatory policies, increasing healthcare access, and growing exports. Investor confidence and policy support are being further bolstered by this strong economic outlook.
India was a vital provider of vaccines and treatments during the COVID-19 pandemic, which greatly enhanced the sector's reputation internationally. The sector is currently developing quickly due to the use of robotics, AI-enabled smart pharmaceuticals, and continuous manufacturing systems. India is becoming a pioneer in the production of value-added pharmaceuticals due to digital platforms, data integrity technologies, and extensive research and development in biosimilars and complex generics.
2. Electronics & Smartphones – India’s Digital Manufacturing Frontier
India, which has more than 250 electronics manufacturing facilities, has become the world's second-largest producer of smartphones. Due to the PLI Scheme, the industry is undergoing rapid change, OEMs (Original Equipment Manufacturers) are replacing basic contract manufacturing, and Industry 4.0 technologies are becoming widely used. Exports of electronic items increased steadily, from $2.10 billion in April 2023 to $2.65 billion in April 2024. Apple, Foxconn, Pegatron, Wistron (Tata Electronics), and Samsung are among the major companies making significant investments in India's electronics infrastructure. Exports of smartphones alone grew 42% year over year to $15.6 billion in FY 2023–2024. In addition to smartphones, India is making strides in the production of wearables, semiconductors, PCBs, and Internet of Things devices.
3. MSMEs – Backbone of Localized Manufacturing
India's industrial economy is anchored on its Micro, Small, and Medium-Sized Enterprises (MSMEs), which account for around 36% of the GDP of the manufacturing sector. Over 4 million MSMEs from a variety of industries, including textiles, food processing, chemicals, precision tools, and engineering components, are registered on the Udyam portal and Udyam Assist Platform in India as of 2024. To improve their competitiveness and market access, MSMEs are now taking advantage of the advantages offered by Startup India, Digital India, and ONDC (Open Network for Digital Commerce). Even business owners in Tier-II and Tier-III cities are now able to implement lean production, smart manufacturing techniques, and quality assurance technologies due to reforms centered on credit facilitation, ease of doing business, and digitization.
4. Semiconductors & Smart Components – Building India’s Silicon Future
India is making a lot of effort to produce semiconductors in order to lessen its reliance on imports and support its goals in the fields of electronics, automotive, aerospace, and defense. Aiming to create fabrication, ATMP (Assembly, Testing, Marking & Packaging) units, and design centers, the $10 billion "Semicon India" incentive program supports strategic investments from Micron, Vedanta-Foxconn JV, ISMC, and others. States such as Gujarat, Karnataka, and Maharashtra are creating electronic clusters and semiconductor parks with plug-and-play infrastructure and regulatory assistance. India is focusing on the whole ecosystem, including embedded systems, chip design, IP development, and hardware tailored to artificial intelligence, rather than just chip manufacturing.
With electronics and AI adoption accelerating, the India semiconductor market Size is expected to grow from USD 52.90 billion in 2024 to USD 189.42 billion by 2035, at a CAGR of 12.30% during the forecast period 2025-2035. This sector will play a pivotal role in enabling India’s goals in Industry 4.0, digital transformation, EVs, robotics, and defense tech manufacturing.
5. Automotive – From Two-Wheelers to Luxury EVs
In FY 2023–2024, India produced 28.43 million vehicles, including passenger cars, two-wheelers, commercial vehicles, electric vehicles, and quadricycles, making it the third-largest automotive sector in the world. India has grown into a major exporter of mid-range and low-cost automobiles, as well as a growing producer of luxury automobiles. The market is dominated by OEM behemoths like Tata Motors, Maruti Suzuki, Mahindra, Hyundai, Kia, Toyota, and Honda, as well as premium manufacturers with regional assembly or manufacturing facilities, such as Volvo (Bengaluru), Mercedes-Benz (Chakan), BMW (Chennai), Audi (Aurangabad), and JLR (Pune). Through PLI initiatives, India is growing its EV ecosystem, gigafactories, and battery supply chain in response to the government's push for electric transportation.
About the Spherical Insights & Consulting
Spherical Insights & Consulting is a market research and consulting firm which provides actionable market research study, quantitative forecasting and trends analysis provides forward-looking insight especially designed for decision makers and aids ROI.
Which is catering to different industry such as financial sectors, industrial sectors, government organizations, universities, non-profits and corporations. The company's mission is to work with businesses to achieve business objectives and maintain strategic improvements.
CONTACT US:
For More Information on Your Target Market, Please Contact Us Below:
Phone: +1 303 800 4326 (the U.S.)
Phone: +91 90289 24100 (APAC)
Email: inquiry@sphericalinsights.com, sales@sphericalinsights.com
Contact Us: https://www.sphericalinsights.com/contact-us
Need help to buy this report?