Supported by favorable policies and consistent government spending, India's manufacturing sector is experiencing significant growth. The supply chain reorganization post-pandemic, combined with government-led initiatives aimed at boosting investments, promoting import substitution, and enhancing export focus, is fueling this upward trajectory. 

Capital Goods

Government policies and increased public expenditure have rekindled private CAPEX, driving demand in the capital goods sector. This growth is evident in sectors like cement, steel, and defense, where infrastructure development is surging. Additionally, exports of engineered goods have risen from $65 billion in FY17 to $109.3 billion in FY24.

Electronics Export

The import substitution in industries like the electronics manufacturing has resulted in Indian companies being preferred over imported ones due to cost savings, reduced lead time, and good quality. From exporting zero mobile phones in 2014 to now becoming the 2nd largest exporter globally, electronic exports increased from $8.4 billion in FY19 to $23.6 billion in FY23.

Textile

India enjoys a competitive advantage in the cotton value chain, particularly evident in the home textiles sector. The 'China Plus One' strategy and supply chain shifts are boosting India's textile industry. Consequently, India's textile exports to the US are rising, while China's share is decreasing.