Indian Manufacturing – The Challenge and The Opportunity

By Geetanjali Kirloskar Today, the Indian manufacturing sector, at $600 billion, accounts for 17% of a $3.5 trillion economy. If Indian manufacturing addresses its challenges, growth opportunities are enormous. Economists and planners agree that the manufacturing sector must rise to 25% of the economy if India is to reach its target of a $30 trillion Viksit Bharat economy by 2047, making it a $8 trillion economy behemoth by then. Over the shorter term, the target is for the Indian economy to reach $10 trillion by 2035. Even if manufacturing's share of the Indian economy rose to 20% by then, it would be a $2 trillion economy - a decade growth opportunity of more than 200%. There are four areas in the manufacturing sector that it should focus on if it were to transform its challenges to harness the opportunity. The first is that Indian manufacturing must become more productive and produce better quality goods cost-effectively, enabling it to capture a higher share of private final consumption. The Japanese approach to Total Quality Management (TQM) and Kaizen are proven methods, and a grassroots movement to incorporate such practices across India's manufacturing, from large set-ups to SMEs, would yield dramatic results. Given my role as a catalyst in enhancing the India-Japan partnership, I would be glad to nurture such an initiative. The second area is for Indian manufacturing to expand its expertise and focus on the higher-value added sectors of the Stan-Shih Mmile curve- developing new concepts, products, and designs by focusing on R&D and improving branding, marketing, distribution and service. By enhancing quality and productivity, developing new products and designs, and using more effective marketing means that Indian manufacturing can reverse its falling share of consumer spending in India and capture shares in global markets. A third issue that the manufacturing sector must address is in the area of human resources. At the worker level, manufacturing in India would get a tremendous fillip if vocational studies after high school are given a higher social status through a high-intensity awareness program and the entry of high-quality private and private-public initiatives in vocational training. A case study in this area would be that of Germany. At the engineering, scientific, and management levels, it is essential to raise awareness of manufacturing as a high-growth, cutting-edge, high-opportunity area, thus attracting the best minds and talent to manufacturing and enabling India to become an advanced manufacturing country. Finally, to fulfil the dream of a Viksit Bharat by 2047, Indian manufacturing must be future ready by investing in developing the next generation of manufacturing sectors - semiconductors, advanced materials, space engineering, robotics, drones, aeronautics, defence, energy systems, including green hydrogen and modular nuclear and advanced machinery. Movement is visible in many of the above areas, but more must be done to become a global player in a few sectors. To conclude, while Government initiatives and support are important, the essential fuel that will drive the manufacturing revolution in India is the entrepreneurial and innovative spirit of its SME and start-up sectors and an expansive, global vision of its corporate sector. The next ten years will be the litmus test for us to live up to the challenge and the opportunity. As published on https://indiaat100foundation.com/front/assets/img/may_2025-06.html