In September 2014 Make in India initiative was unveiled, envisioning India as a global manufacturing powerhouse. The programme aimed to increase the manufacturing sector’s contribution to GDP from 16–17% to 25%, create 100 million new manufacturing jobs by 2022, and boost the ease of doing business in India. Nearly a decade later, the initiative has seen successes and struggles, highlighting its transformative potential alongside areas needing improvement.
The initiative conceived under the vision of “Atmanirbhar Bharat” or self-reliant India, the vision emphasises five key pillars: a robust economy, modern infrastructure, technology-driven systems, a vibrant demographic structure, and optimal utilisation of demand and supply.
According to Chandrakant Dange, President of ZF Steering Gear India Ltd, “Atmanirbharta represents a transformative shift from reliance on imports to self-sufficiency in manufacturing.” The focus on defense production exemplifies this shift, as India aims to reduce its dependency on foreign military equipment.
Since the launch of “Make in India,” there have been notable strides in various manufacturing sectors. Electronics, automobiles, and defense have seen substantial investments. For instance, Jabil, a leading electronics manufacturer, recently announced a ₹1,000 crore investment in Gujarat to set up an electronics manufacturing services unit. This move signifies confidence in India’s potential to become a manufacturing powerhouse for electronics, a sector that has been rapidly expanding due to the demand for smart devices and other technologies.
Make in India has elevated India’s position in global manufacturing. From being predominantly service-oriented economy, India has diversified its industrial base. Today, India ranks among top ten manufacturing nations globally, supported by competitive labour costs, a growing domestic market and strategic initiatives. Sectors like automotive, electronics and pharmaceuticals have seen exponential growth, with global companies choosing India as their manufacturing destination.
India’s automotive sector, for instance, emerged as the world’s fourth-largest by volume, with domestic players like Tata Motors and Mahindra & Mahindra gaining international recognition. In electronics, India has transformed into a key manufacturing hub, attracting giants like Samsung and Apple to establish facilities. Such progress underscores the programme’s role in reshaping India’s industrial identity.
Nakul Mehta, Managing Director of Bharat Bijlee Limited, states, “The key indicators of manufacturing’s share in the economy are yet to show the desired improvement.” While investments in sectors such as smartphones and semiconductors are promising, overall performance metrics like the Index of Industrial Production (IIP) and gross fixed capital formation in manufacturing have not consistently met expectations.
The “Make in India” initiative continues to be a cornerstone of India’s industrial growth, aiming to position the country as a global manufacturing hub. By leveraging its strategic advantages, such as a large, skilled workforce and improving ease of doing business, India is transforming into an attractive destination for both domestic and foreign investment.
As per recent developments, the initiative has bolstered sectors like electronics, automotive, and defence, encouraging both multinational and Indian companies to increase their production within the country. This not only strengthens India’s position in global supply chains but also promotes job creation and technological advancements across various industries.
The government’s focus on ‘Atmanirbhar Bharat’ (self-reliant India) is helping reduce dependency on imports, while the introduction of policy reforms—like the Production Linked Incentive (PLI) scheme—has stimulated growth in key sectors. Moreover, the initiative aligns with India’s long-term objectives of sustainable growth, with a focus on innovation, digital transformation, and improving the global competitiveness of Indian manufacturers.
This policy shift is playing a pivotal role in making India a global leader in innovation and manufacturing excellence, positioning the country for future industrial dominance.
Sectors driving growth
The initiative has succeeded in catalysing growth in sectors like electronics, defence, and automotive manufacturing, bolstered by fiscal incentives and policy reforms. Pushkar Gokhale, Executive Vice President & Business Head, Godrej & Boyce sums up the industrial growth well:
- Rise in FDI inflows: Foreign Direct Investment (FDI) inflows increased significantly from $45.4 billion in 2014-15 to $83.6 billion in 2020-21, with FDI in the manufacturing sector growing from $4.4 billion to $21.4 billion during the same period.
- Contribution to GDP: The manufacturing sector’s share of GDP improved from 16.3% in 2014-15 to 17.4% in 2020-21.
- Industrial and export growth rates: The industrial production growth rate averaged 4.4% annually between 2015-2020, compared to 2.5% during 2010-2014. Exports also saw growth, averaging 10.5% annually from 2015-2020, up from 5.5% in 2010-2014.
- Job creation: Over 4 million new jobs were created in the manufacturing sector between 2014-2020, reflecting a 24% increase in manufacturing employment.
- Industrial capacity utilisation: Capacity utilisation in the industrial sector rose from 70% in 2014-15 to 75% in 2020-21.
- Electronics manufacturing surge
India’s electronics industry has experienced exponential growth since 2014. In 2022, the electronics manufacturing sector was valued at $120 billion, up from $37 billion in 2014. Mobile phones alone make up 43% of this output, positioning India as the second –largest mobile manufacturer globally. The Production-Linked Incentive (PLI) scheme launched in 2020 played a pivotal role, offering incentives to domestic manufacturers for scaling production. Companies such as Apple, Samsung, and Foxconn have established or expanded manufacturing units in India, creating jobs and strengthening India’s export capabilities. Indian now produces 99% of its mobile phones domestically, which significantly enhances its position in the global manufacturing landscape. “In recent years, investments in new factories, including for smart phones and semiconductors, have taken place to make products in India at global scales and quality levels. These are encouraging developments, but one must also consider the aggregate performance of manufacturing in India. The key indicators of manufacturing’s share in the economy’s GVA; the sector’s IIP; gross fixed capital formation in manufacturing as a percentage of the GDP; employment in manufacturing; and FDI, are yet to show the desired improvement,” emphasis Nakul.
Despite this growth, India’s global electronics manufacturing share remains limited compared to dominant players like China and South Korea. To further expand its role, India must focus on bolstering its component manufacturing and semiconductor capabilities. Efforts are being made to localise production of critical components, which currently rely heavily on imports. With continued investment and policy support, India is expected to grow into a global electronics hub, potentially offering millions of jobs by FY30. - Automotive revolution
India’s position as the world’s fourth-largest automotive market showcases the success of Make in India. In FY 2023, India produced 5.45 million passenger vehicles, up from 3.1 million in FY 2014. Electric vehicle (EV) manufacturing has gained traction, with domestic brands like Tata Motors and Mahindra leading in EV adoption and exports.
The focus on green mobility aligns with India’s climate goals, including the commitment to achieving net-zero emissions by 2070. By 2030, EVs are expected to account for 30% of private cars, 70% of commercial vehicles, and 80% of two- and three-wheelers, according to NITI Aayog projections. - Defence manufacturing: A self-reliance success story
The defence sector highlights the tangible impact of Make in India. From being the world’s second-largest arms importer in 2014, India has now boosted indigenous production significantly. In 2023–24, domestic defence production reached ₹1.27 lakh crore, with exports rising to ₹15,920 crore, compared to just ₹1,521 crore in FY 2014.
Key milestones include the indigenous production of fighter jets like Tejas, artillery systems, and armoured vehicles. The Defence Acquisition Procedure (DAP) 2020 prioritised procurement from domestic suppliers, further reducing dependency on imports.
As Chandrakant Dange, President of ZF Steering Gear India Ltd, remarks:
“India’s defence manufacturing journey is a point of pride. With a target of ₹3 lakh crore in production by 2029, the sector is poised to redefine India’s self-reliance. With strategic policies in place, a growing emphasis on indigenization, and a vibrant defence industrial base, India is poised to not only meet its own security needs but also emerge as a key player in the global arms market. “ - Pharmaceutical dominance: India’s role as the ‘Pharmacy of the World’
India’s reputation as the “Pharmacy of the World” was firmly cemented during the COVID-19 pandemic, showcasing the country’s unparalleled ability to deliver affordable, high-quality medicines to global markets. With a robust pharmaceutical industry valued at over $50 billion, India accounts for approximately 20% of the global supply of generic medicines and over 60% of global vaccine production.
The pandemic presented unprecedented challenges, but Indian pharmaceutical giants like Cipla, Dr. Reddy’s Laboratories, and Serum Institute of India rose to the occasion. They scaled production capabilities, fast-tracked research, and ensured the timely delivery of life-saving drugs and vaccines worldwide. Cipla, for instance, leveraged its experience in antiviral drugs to manufacture critical COVID-19 therapies like Remdesivir. Similarly, Dr. Reddy’s Laboratories collaborated with global partners to manufacture and distribute the Sputnik V vaccine in India, addressing the urgent need for immunisation.
India’s success stems from its well-established infrastructure, cost-effective production methods, and a skilled workforce. The country’s pharmaceutical sector is supported by nearly 3,000 drug companies and over 10,500 manufacturing units, which adhere to stringent international standards such as the USFDA and WHO-GMP. This allows Indian manufacturers to produce high-quality medicines at a fraction of the cost compared to developed nations.
Furthermore, India’s commitment to innovation played a pivotal role during the pandemic. Companies invested heavily in R&D to develop new drug formulations and ensure efficient production processes. This effort not only strengthened India’s global position but also underscored its ability to adapt to dynamic challenges.
The pharmaceutical dominance extends beyond generics and vaccines. India is emerging as a hub for biosimilars, APIs (active pharmaceutical ingredients), and complex formulations. Its success during COVID-19 highlights the critical role India plays in addressing global healthcare needs. Moving forward, the nation aims to further consolidate its leadership by focusing on sustainable manufacturing practices, digitalisation, and strengthening its R&D ecosystem. - Renewable energy: India’s rise as a global manufacturing leader
India has solidified its position as a global leader in renewable energy manufacturing, driven by its ambitious climate goals and a commitment to sustainable development. The country has made remarkable progress in scaling up the production of solar panels and wind energy equipment, supporting both domestic needs and global demand.
The solar energy sector has witnessed significant growth, with India becoming one of the top five solar panel manufacturers globally. Initiatives like the Production Linked Incentive (PLI) scheme have encouraged domestic manufacturing, reducing dependence on imports and creating a robust supply chain. Indian companies such as Adani Solar, Vikram Solar, and Waaree Energies are not only meeting local demand but also exporting to international markets. These efforts align with India’s aim of achieving 280 GW of solar capacity by 2030, contributing to the broader goal of generating 500 GW of renewable energy by the same year.
Wind energy equipment manufacturing has also seen substantial growth. India is now the fourth-largest wind power producer globally, supported by a strong domestic manufacturing base. Companies like Suzlon and ReNew Power are innovating in turbine design and energy storage solutions, enabling cost-effective and efficient wind energy production.
By fostering innovation, investing in infrastructure, and leveraging its skilled workforce, India is poised to further expand its renewable energy manufacturing capabilities. These advancements not only bolster India’s energy transition but also position the country as a key player in the global clean energy supply chain.
Eswara Rao Nandam, CEO & MD of Polymatech Electronics Limited
“The Indian Government’s commitment towards the ‘Make in India / Atmanirbhar Bharat’ initiatives has influenced many entrepreneurs. Polymatech takes pride in being a part of this initiative. In line with the Government’s vision of becoming a global semiconductor hub, Polymatech is also augmenting our capabilities and capacities. Improving infrastructure, especially reliable electricity and specialized gases, will promote sector growth. Financial incentives like zero-rated tax will initially boost investments. By focusing on key developments, the government can unlock significant potential, drive economic growth, and position India as a global leader in semiconductors.“
The role of technology
Technological advancements are crucial for enhancing productivity and competitiveness in the manufacturing sector. Companies are increasingly adopting automation, digitalization, and advanced manufacturing techniques to improve efficiency. The integration of Industry 4.0 technologies is necessary for Indian manufacturers to compete globally, and the government’s support in this regard will be vital.As companies like Jabil set up advanced manufacturing facilities in India, the potential for creating high-quality jobs in technology-driven sectors increases. This aligns with the government’s vision of a skilled workforce capable of meeting the demands of modern manufacturing.
FDI inflows boosting India’s manufacturing landscape
India witnessed record-high Foreign Direct Investment (FDI) inflows of $84.8 billion in FY 2021-22, a testament to its growing appeal as a global investment destination. This remarkable achievement is largely attributed to investor-friendly policies, infrastructure development, and targeted initiatives under programmes like Make in India. A significant share of these inflows was directed toward the manufacturing sector, underscoring the country’s emergence as a preferred hub for production and innovation.
Policies permitting 100% FDI in various sectors, including defence, automobiles, electronics, and renewable energy, played a pivotal role in attracting global corporations. The defence sector, in particular, saw a surge in interest due to reforms allowing up to 74% FDI through the automatic route, encouraging investments in indigenous manufacturing of advanced weaponry and equipment. Similarly, initiatives like the Production Linked Incentive (PLI) schemes across multiple sectors further enhanced India’s competitiveness by offering financial incentives for domestic production.
The government’s push to streamline regulations, improve ease of doing business, and upgrade industrial infrastructure has also been a key driver. States such as Maharashtra, Gujarat, and Karnataka emerged as FDI hotspots, drawing investments from major global players seeking to capitalise on India’s large consumer base and skilled workforce.
These record-breaking FDI inflows reflect India’s growing economic resilience and its strategic focus on fostering manufacturing excellence, innovation, and self-reliance. The total amount of FDI inflows received during the last ten years (April 2014-June 2024) was US$ 725.96 billion. Key sectors include services, computer hardware and software, and telecommunications. For example:
- Google committed to investing $10 billion in India’s digital ecosystem.
- Vedanta-Foxconn announced a $19.5 billion semiconductor facility in Gujarat to bolster India’s chip-making capabilities.
Shailesh Sharma, Director Operations – SKF India and South East Asia
“It is evident by growth in manufacturing, FDI inflow and job creation. Friendly government policies, rapid infrastructure development and ease of doing business are some very important contributing factors. FDI, which was around $45 billion in 2014-15, has increased to around $85 billion in 2021-22. This has boosted various sectors like pharma, electronics, automobile etc. India has made significant progress in defense sectors as well. INS Vikrant, the country’s first indigenous aircraft carrier is an example. Today India exports defense equipment to around 90 countries. India improved its ranking in the World Bank’s Ease of Doing Business index, moving from 142nd in 2014 to 63rd in 2022. This reflects the government’s efforts to simplify regulations and create a more business-friendly environment. Overall, the Make in India initiative has played a pivotal role in transforming India’s position.“
Challenges and areas needing attention
Despite these successes, challenges persists. While India has made progress, several challenges hinder its goals, particularly in scaling manufacturing and generating employment. The manufacturing sector’s contribution to Gross Value Added (GVA) has not seen the desired increase, and employment in manufacturing has not kept pace with expectations. The global economic landscape, marked with geopolitical tensions and supply chain disruptions, presents both challenges and opportunities for India.
Abhishek Malik, Executive Director, Calcom Vision Limited
“We are now in the Make in India 2.0 phase, which further strengthens India’s position as a global manufacturing leader. This initiative focuses on attracting investment, enhancing the ease of doing business, and accelerating local manufacturing. Key aspects such as cost efficiency and sustainable production have been central to this growth, while also bolstering job creation and skill development initiatives. Through our innovations in the LED industry and the formation of Calcom Taehwa Techno Private Limited (CTTPL) , a joint venture with a leading Korean Multinational company – Taehwa, we are advancing cutting-edge technologies such as BLDC fan solutions.”
The government’s fiscal policies, including tariffs and tax cuts, aims to stimulate domestic manufacturing. However, sustained economic growth is essential to foster consumption and private sector capital investment. As noted by Nakul, India to move up the value chain ladder, there must be ongoing emphasis on employability and skilling as well as incentivization of innovation and R&D.
- Slow manufacturing growth
India’s manufacturing sector contributed only 14–16% of GDP in FY 2023, far short of the targeted 25%. According to CMIE data, the share of manufacturing employment has increased marginally from 11.4% in FY 2014 to 12.1% in FY 2023, reflecting subdued growth.
Moreover, India’s Gross Fixed Capital Formation (GFCF) in manufacturing remains below expectations. A report by McKinsey estimates that an annual investment of $100 billion is needed to achieve the desired manufacturing growth rate of 9–10% by 2030. - Infrastructure and logistics gaps
India ranks 38th in the World Bank’s Logistics Performance Index (LPI), with inefficiencies in port handling, road connectivity, and supply chain infrastructure increasing costs for manufacturers.
The government’s National Infrastructure Pipeline (NIP), with a projected investment of ₹111 lakh crore by 2025, and the PM Gati Shakti Master Plan aim to address these issues. However, implementation delays remain a concern. - Skilling and workforce challenges
A lack of adequately skilled workers poses a major hurdle. India requires an additional 100 million skilled workers by 2030 to meet industry demands, particularly in emerging technologies like robotics, IoT, and AI. The Skill India initiative has trained 56.8 million people since 2015, but the quality and industry alignment of these programmes need improvement. - Policy interventions and the road ahead
Recognising these challenges, the government has introduced targeted policies: - PLI Scheme
Covering 14 sectors, the PLI scheme aims to boost domestic manufacturing and exports. It is expected to add $520 billion to India’s economy by 2027 and create 6 million jobs. - Digital manufacturing
The adoption of Industry 4.0 technologies is vital for India’s competitiveness. Government programmes like SAMARTH Udyog Bharat 4.0 and investments in smart factories and automation are helping manufacturers scale operations efficiently. - Decarbonising manufacturing
With global shifts towards sustainability, initiatives like the Green Manufacturing Initiative (GMI) are enabling industries to adopt cleaner processes, reduce emissions, and optimise energy usage.
Opportunities
The US-China trade war and the COVID-19 pandemic have triggered a realignment of global supply chains. This “China+1” strategy has benefitted India, with firms diversifying their operations.
In 2022, India’s exports of manufactured goods grew by 15%, reaching $418 billion, driven by sectors like chemicals, pharmaceuticals, and electronics. The future of “Make in India” hinges on several factors. The government must continue to implement policies that foster an environment conducive to manufacturing, while the private sector must invest in innovation and skill development. The emphasis on self-reliance should not only be about producing domestically but also about enhancing the quality and technological sophistication of Indian-made products.
The intersection of investment in infrastructure, technology, and human capital will be critical in determining the success of the initiative. As noted by Dange, “India is well on its way to solidifying its status as a formidable force in global manufacturing.” This requires a collective effort from the government, industry leaders, and educational institutions to build a resilient manufacturing ecosystem.
Journey forward
As the Make in India initiative celebrates its 10th anniversary, its stands as a powerful testament to India’s determination to reshape its manufacturing landscape and enhance its global standing. The initiative has made significant strides in promoting domestic manufacturing and attracting investment. The success of indigenous projects like the Vande Bharat trains and INS Vikrant, alongside record-breaking FDI inflows, reflects India’s growing self-reliance and competitiveness on the global stage. As India moves forward with initiatives like the PLI Scheme and PM GatiShakti, it is well positioned to achieve sustained economic growth, create employment opportunities, and reinforce its role as a major player in the global manufacturing landscape.
While there are challenges to overcome, the potential for India to become a global manufacturing hub remains strong. The initiative’s success will ultimately depend on continued commitment, strategic policy implementations, and collaboration across sectors. As we reflect on the journey of “Make in India,” it is clear that while the path has not been without obstacles, the foundation for a robust manufacturing sector is being laid. With sustained efforts, India can indeed achieve its vision of self-reliance and emerge as a key player in the global manufacturing landscape.
