NITI Aayog proposes a targeted industrial approach, emphasising cluster-based manufacturing and domestic value addition to position India as a competitive global manufacturing powerhouse by 2047.
NITI Aayog has set out a sharper industrial strategy for India, arguing that the country should stop trying to lift manufacturing through broad, subsidy-heavy targets and instead focus on sectors where commercial demand, export potential and domestic capability already give it a realistic edge. The study, titled “Key Sectors to Position India as a Global Manufacturing Hub”, frames manufacturing not just as a contributor to growth but as a major source of non-farm jobs at a time when employment generation remains a central economic challenge.
The first volume of the study examines chemicals, textiles, telecom and network equipment, and solar photovoltaic in detail, while the broader exercise shortlists 12 sectors with the potential to support global leadership by 2047. Those sectors include electronics, pharmaceuticals, automotive, defence and drones, steel, capital goods, food processing, leather and footwear, alongside the four examined more closely. According to the materials released around the study, the assessment weighs market size, competitiveness, infrastructure readiness, policy support, raw materials, technology, employment potential and India’s current position in each value chain.
One of the clearest themes is the case for cluster-based manufacturing. NITI Aayog argues that integrated industrial parks with shared utilities, better infrastructure and faster approvals can help firms scale up while lowering costs. The study also points to the need for deeper domestic value addition, stronger local component production, better testing and certification systems, more skill development and closer links between industry and academia. In a notable shift of emphasis, the report says investment will flow where profits are credible, suggesting that the state’s job is to remove bottlenecks rather than chase output share for its own sake.
The sector studies also highlight specific vulnerabilities and opportunities. In solar photovoltaic, the report recommends moving further upstream into polysilicon and wafers, while warning about heavy export dependence on one market: the United States accounted for 97% of India’s solar module exports between 2019-20 and 2025-26, according to the study. It says India had 106 GW of installed solar capacity by March 2025 and must add about 174 GW to reach its 280 GW target by 2030. In textiles, the report urges a shift towards man-made fibres to help lift exports to $100 billion by 2029-30, while in telecom it backs the National Telecom Policy 2025 goals of doubling GDP contribution, exports and investment, and creating 1 million jobs by 2030.
The chemicals and textiles findings underline the industrial stakes. The chemicals sector, led by petrochemicals, specialty chemicals and inorganic chemicals, could cut import dependence and conserve foreign exchange if India expands production of key products such as phenol, methanol and acetic acid. Textiles remain one of the country’s largest manufacturing employers, supporting more than 45 million people, accounting for 11% of manufacturing gross value added and 9% of merchandise exports, while contributing about 2% to GDP and 4.1% of global textile and apparel exports. Together, the findings present manufacturing as a practical route to jobs, resilience and larger participation in global supply chains, but only if India can build scale, improve productivity and attract private capital.
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