India Manufacturing Sector Market Size
| Study Period | 2020 - 2029 |
| Base Year For Estimation | 2023 |
| Forecast Data Period | 2024 - 2029 |
| Historical Data Period | 2020 - 2022 |
| CAGR | > 4.00 % |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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India Manufacturing Sector Market Analysis
India's Manufacturing Sector Market is expected to register a CAGR of more than 4 % during the forecast period (2023 - 2028).
- India's manufacturing sector had gone through various phases of development during COVID-19. The sector contributes to approximately 16-17% of the GDP and employs almost 20% of the country's workforce. During the first wave of the pandemic, lockdown-imposed restrictions on the movement of goods and people severely impacted workforce capacity and disrupted supply chains, bringing nearly all manufacturing activity to a stand-still.
- India is an attractive hub for foreign investments in the manufacturing sector. Several mobile phones, luxury, and automobile brands, among others, have set up or are looking to establish their manufacturing bases in the country. Implementing the Goods and Services Tax (GST) will make India a common market with a GDP of USD 2.5 trillion and a population of 1.32 billion people, which will be a big draw for investors. The Indian Cellular and Electronics Association (ICEA) predicts that India has the potential to scale up its cumulative laptop and tablet manufacturing capacity to USD 100 billion by 2025 through policy interventions.
- One of the initiatives by the Government of India's Ministry for Heavy Industries & Public Enterprises is SAMARTH Udyog Bharat 4.0, or SAMARTH Advanced Manufacturing and Rapid Transformation Hubs. This is expected to increase the manufacturing sector's competitiveness in the capital goods market. With an impetus on developing industrial corridors and smart cities, the Government aims to ensure the nation's holistic development. The corridors would further assist in integrating, monitoring, and developing a conducive environment for industrial development and will promote advanced practices in manufacturing.
- India is gradually progressing on the road to Industry 4.0 through the Government of India's initiatives like the National Manufacturing Policy which aims to increase the share of manufacturing in GDP to 25 percent by 2025 and the PLI scheme for manufacturing which was launched in 2022 to develop the core manufacturing sector at par with global manufacturing standards. The manufacturing sector in India is gradually shifting to more automated and process-driven manufacturing which is expected to increase the efficiency and boost production of the manufacturing industry.
India Manufacturing Sector Market Trends
This section covers the major market trends shaping the India Manufacturing Sector Market according to our research experts:
Growing Government Spending to Boost the Manufacturing Sector
Manufacturing has emerged as one of the high-growth sectors in India. Prime Minister of India, Mr. Narendra Modi, launched the 'Make in India' program to place India on the world map as a manufacturing hub and give global recognition to the Indian economy. For instance, in August 2021, Wistron Corp. collaborated with India's Optiemus Electronics to manufacture products such as laptops and smartphones, which significantly boosts the 'Make in India' initiative and electronics manufacturing in the country.
During the second quarter of 2021, the contribution of India's manufacturing industry to the country's GDP was valued at over 6.7 trillion Indian rupees. Between April 2000 to June 2022, the automobile sector received FDI inflows of USD 33.53 billion. The chemical manufacturing sector (excluding fertilizers) received FDI inflows worth USD 20.41 billion. The drug and pharmaceutical manufacturing sector received FDI inflows worth USD 19.90 billion.
The Government of India has taken several initiatives to promote a healthy environment for the growth of the manufacturing sector in the country. In the Union Budget 2022-23, the government allocated Rs. 2,403 crores (USD 315 million) for the Promotion of Electronics and IT Hardware Manufacturing. The PLI for semiconductor manufacturing is set at Rs. 760 billion (USD 9.71 billion), to make India one of the world's major producers of this crucial component.
In April 2021, Samsung started manufacturing mobile display panels at its Noida plant and plans to ramp up manufacturing IT display panels soon. Samsung Display Noida, which has invested Rs. 4,825 crores (USD 650.42 million) to move its mobile and IT display manufacturing plant from China to Uttar Pradesh, has received special incentives from the state government.
In September 2021, Prime Minister Mr. Narendra Modi approved the production-linked incentive (PLI) scheme in the textiles sector for man-made fiber (MMF) apparel, MMF fabrics, and 10 segments/products of technical textiles at an estimated outlay of Rs. 10,683 crores (USD 1.45 billion). In May 2021, the government approved a PLI scheme worth Rs. 18,000 crores (USD 2.47 billion) for the production of advanced chemical cell (ACC) batteries; this is expected to attract investments worth Rs. 45,000 crores (USD 6.18 billion) in the country, and further boost capacity in core component technology and make India a clean energy global hub. Hence, government spending in India is expected to boost the demand for the manufacturing sector market during the forecast period.
Growth of the Automotive Industry is Driving the Market
In the Automobile market in India, Two-wheelers and passenger cars accounted for 76% and 17.4% market share, respectively. Passenger car sales are dominated by small and midsized cars. The export of the total number of automobiles increased from 4,134,047 in 2020-21 to 5,617,246 in 2021-22, registering a positive growth of 35.9%. India was one of the leading countries in the world in terms of vehicle production.
From April 2021 to March 2022, Passenger Vehicle Exports increased from 404,397 to 577,875 units (registering a positive growth of 42.9%), Commercial Vehicle Exports increased from 50,334 to 92,297 units, Three Wheeler Exports increased from 393,001 to 499,730 units and Two Wheelers Exports increased from 3,282,786 to 4,443,018 units in April 2021 to March 2022 over the same period last year.
The PLI scheme (outlay of USD 3.5 Billion) for the automobile sector proposes financial incentives of up to 18% to boost domestic manufacturing of advanced automotive technology products and attract investments in the automotive manufacturing value chain.
In the financial year 2022, the total production volume of vehicles in India was around 22.9 million units, which was an increase from the previous year. In 2020, the production value contracted for the first time. This was partially due to the introduction of the new Bharat Stage VI (BS-VI) emissions standards from April 1, 2020, and overall scaled-down production to the lower stock of the old BS-IV vehicles. Further decline in production was contributed by the coronavirus pandemic in India.
Two-wheelers have been the predominant vehicle type produced in India and also made up the majority of automobiles sold domestically. Two-wheelers in India are divided into three subcategories, namely, motorcycles, scooters, and mopeds. The future growth point of this sector is expected to be electric scooters and motorcycles and many leading manufacturers have already started producing electric vehicles. For instance, in January 2023, Mahindra and Mahindra Ltd, one of India's leading automotive companies, announced that their investment of Rs. 10,000 crores (USD 1226.74 million) for electric vehicles have been approved under the Maharashtra government's industrial promotion scheme for electric vehicles.
India Manufacturing Sector Industry Overview
The Indian manufacturing sector market landscape is fragmented in nature with a mix of global and local players. Some of the major players present in the market include Tata Motors Ltd, Mahindra & Mahindra Limited, Ashok Leyland, Hindustan Unilever Limited, Godrej group, and many more. Major companies in the market have adopted product launches, partnerships, business expansions, and acquisitions as their key developmental strategies to offer better products and services to customers in the manufacturing industry. For instance, in December 2022, Tata Passenger Electric Mobility, a subsidiary of Tata Motors, completed the acquisition of Ford India's vehicle manufacturing plant in Sanand for Rs 725.7 crores (USD 89.01 million). This acquisition will unlock an additional state-of-the-art manufacturing capacity of 300,000 units per annum, scalable to 420,000 units per annum.
India Manufacturing Sector Market Leaders
Tata Motors Ltd
Mahindra & Mahindra Limited
Ashok Leyland
Hindustan Unilever Limited
Godrej group
*Disclaimer: Major Players sorted in no particular order
India Manufacturing Sector Market News
- January 2023: Auto component manufacturer, Sundram Fasteners has won the biggest EV contract in its 60-year history. The Chennai-based company has been awarded a USD 250-million contract by a leading global automobile manufacturer for the supply of sub-assemblies for its electric vehicle (EV) platform. Sundram Fasteners has estimated an annual sales peak of USD 52 million in 2026 with a supply of 1.5 million drive unit sub-assemblies per annum.
- January 2023: Tata motors (an Indian multinational automotive manufacturing company) is considering setting up plants in India and Europe to produce battery cells for electric vehicles, the chief financial officer of its auto unit told Reuters in an interview. With total sales of 50,000 electric cars to date, India's Tata Motors dominates the country's EV market and has outlined plans to launch 10 electric models by March 2026.
India Manufacturing Sector Market Report - Table of Contents
1. INTRODUCTION
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
4.1 Current Market Scenario
4.2 Insights into Government Initiatives
4.3 Insights into Recent Significant Investments and Developments the Industry
4.4 Insights into Manufacturing Clusters in India
4.5 Insights into History of Manufacturing Industry in India
4.6 Impact of the COVID-19 on the Market
5. MARKET DYNAMICS
5.1 Market Drivers
5.2 Market Restraints/Challenges
5.3 Market Opportunities
5.4 Industry Attractiveness - Porter's Five Forces Analysis
5.4.1 Threat of New Entrants
5.4.2 Bargaining Power of Buyers/Consumers
5.4.3 Bargaining Power of Suppliers
5.4.4 Threat of Substitute Products
5.4.5 Intensity of Competitive Rivalry
6. MARKET SEGMENTATION
6.1 By Ownership
6.1.1 Public Sector
6.1.2 Private Sector
6.1.3 Joint Sector
6.1.4 Cooperative Sector
6.2 By Raw Materials Used
6.2.1 Agro Based Industries
6.2.2 Mineral Based Industries
6.3 End-user Industries
6.3.1 Automotive
6.3.2 Manufacturing
6.3.3 Textile and Apparel
6.3.4 Consumer electronics
6.3.5 Construction
6.3.6 Food and Beverages
6.3.7 Other End-use Industries
7. COMPETITIVE LANDSCAPE
7.1 Overview (Market Concentration and Major Players)
7.2 Company Profiles
7.2.1 Tata Motors Ltd
7.2.2 Mahindra & Mahindra Limited
7.2.3 Ashok Leyland
7.2.4 Hindustan Unilever Limited
7.2.5 Godrej group
7.2.6 Maruti Suzuki Limited
7.2.7 Tata Steel Limited
7.2.8 Larsent & Toubro Limited
7.2.9 Apollo Tyres
7.2.10 Moser Baer*
- *List Not Exhaustive
8. FUTURE OF THE MARKET
9. APPENDIX
India Manufacturing Sector Industry Segmentation
Manufacturing is a secondary industry that involves processing raw materials to produce finished goods. It is the production of goods in large quantities after processing the raw materials into more valuable products.
The manufacturing sector in India is segmented by Ownership (Public Sector, Private Sector, Joint Sector, and Cooperative Sector), by Raw Materials Used (Agro Based Industries and Mineral Based Industries), and by End-user Industries (Automotive, Manufacturing, Textile and Apparel, Consumer electronics, Construction, Food and Beverages, and Other End-user Industries). The report offers market size and forecast values (USD billion) for all the above segments.
Furthermore, this report covers market insights, such as market dynamics, drivers, restraints, opportunities, technological innovation, its impact, porter's five forces analysis, and the impact of COVID-19 on the market. In addition, the report also provides company profiles to understand the competitive landscape of the market.
| By Ownership | |
| Public Sector | |
| Private Sector | |
| Joint Sector | |
| Cooperative Sector |
| By Raw Materials Used | |
| Agro Based Industries | |
| Mineral Based Industries |
| End-user Industries | |
| Automotive | |
| Manufacturing | |
| Textile and Apparel | |
| Consumer electronics | |
| Construction | |
| Food and Beverages | |
| Other End-use Industries |
India Manufacturing Sector Market Research FAQs
What is the current India Manufacturing Market size?
The India Manufacturing Market is projected to register a CAGR of greater than 4% during the forecast period (2024-2029)
Who are the key players in India Manufacturing Market?
Tata Motors Ltd, Mahindra & Mahindra Limited, Ashok Leyland, Hindustan Unilever Limited and Godrej group are the major companies operating in the India Manufacturing Market.
What years does this India Manufacturing Market cover?
The report covers the India Manufacturing Market historical market size for years: 2020, 2021, 2022 and 2023. The report also forecasts the India Manufacturing Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
India Manufacturing Industry Report
Statistics for the 2024 India Manufacturing market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. India Manufacturing analysis includes a market forecast outlook to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
