India’s manufacturing sector is increasingly dominating industrial leasing, with projections indicating significant growth through 2030, driven by capacity expansion and sector-specific investments.
India’s manufacturing sector is taking a larger share of industrial real estate as companies seek more space to expand production, shorten supply chains and place operations closer to customers, according to a JLL report cited by IANS. Gross manufacturing leasing has reached 69 million square feet cumulatively, rising at a compound annual rate of 49% since 2021, while the category is on course to account for 40% of the industrial market by 2030.
The shift has already changed the pecking order in India’s industrial property market. Manufacturing is now the second-largest occupier segment after third-party logistics, or 3PL, reflecting the rising importance of factories alongside distribution centres. JLL said gross absorption reached 19.2 million square feet in 2025, while the first half of 2026 added 10.2 million square feet, up 19% from a year earlier.
The consultancy expects annual manufacturing leasing to continue climbing, with total absorption projected at about 46 million square feet by 2030. Another JLL forecast cited by The Economic Times puts annual factory space leasing at 30 million to 32 million square feet by the end of the decade, driven by capacity expansion and localisation across automotive, electronics and renewable energy.
JLL said the demand is being shaped by two distinct strategies. In larger cities, manufacturers are increasingly leasing Grade-A properties, which offer higher specifications and a faster route to market while limiting upfront capital costs. In smaller and emerging markets, companies are more often buying land and building customised facilities to secure long-term control. JLL’s broader manufacturing research points to advanced sectors such as electric mobility, semiconductors, medical devices, aerospace and defence, and electronics as central to India’s industrial push.
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