The Indian machine tool industry is expanding rapidly, driven by demand from both traditional and emerging manufacturing sectors, supported by government initiatives and global supply chain shifts, according to Rajesh Mandlik, CEO of Setco Spindles India Pvt Ltd and Executive Committee Member of the Indian Machine Tool Manufacturers’ Association (IMTMA) - which is hosting IMTEX Forming 2026 from January 21–25 in Bengaluru. In this interaction with Rakesh Rao, Mandlik explains growth opportunities and emerging trends in the industry. 

Could you begin with an overview of the Indian machine tool industry?

The machine tool industry forms the backbone of manufacturing, as virtually every component is produced either through metal cutting or metal forming. Metal cutting currently has a stronger contribution, although metal forming has been expanding steadily. Metal forming covers presses, foundries, castings, laser cutting and forming systems, friction welding machines, and related technologies. Metal cutting spans a wider spectrum, including vertical and horizontal machining centres, turning centres, grinding machines, and several high-precision categories. Together, these two segments define the structure of the industry.

India is the world’s fourth-largest consumer of machine tools and the ninth-largest producer. How do you view the prospects for domestic manufacturing?

The industry has been growing at a compound annual rate of 11 per cent. Several years ago, we projected that the market would reach around Rs 320 billion by 2025, and we have come remarkably close to that estimate. For 2031, we foresee a market of approximately Rs 500–520 billion, and current trends support this outlook.

However, our import dependence remains high. While we are the fourth-largest consumer, we stand only ninth in production, which indicates a sizeable gap. This disparity represents substantial opportunity: if domestic manufacturers can bridge the difference between consumption and production, the industry can unlock significant growth within India itself.

The government has been pushing Make in India and supply chain localisation, especially given global uncertainties and restrictions on imports. Are you seeing genuine support for expanding component manufacturing and strengthening the supply chain?

Yes, there is a noticeable push from the government. Policies under Make in India and Atmanirbhar Bharat are encouraging procurement from Indian manufacturers, especially across public sector units. The geopolitical environment — tensions in China, disruptions linked to the Russia–Ukraine conflict, and shifting global trade dynamics — has also positioned India favourably.

Several factors are working to India’s advantage: a large and skilled talent pool, young demographics, political stability, and the benefits of being a democratic economy. As global companies re-evaluate their manufacturing bases, India is emerging as a preferred destination. This shift directly and indirectly benefits the machine tool industry, as new plants and capacities create additional demand for machinery, tooling and precision components.

Automotive accounts for roughly 50 per cent of machine tool consumption, and various emerging sectors were highlighted. How do you view growth in these newer segments?

The aerospace data may not be entirely clear, but electronic manufacturing is one area where the growth is extremely visible. Several global electronics companies have expanded their presence in South India. India has now become a major exporter of smartphones to the US. Seven to eight years ago, most mobile phones sold here were imported; today, almost all devices sold domestically are manufactured within India.

Semiconductors represent another sunrise sector. Large investments are being made, particularly in Gujarat, as India aims to build a domestic chip ecosystem. Aerospace manufacturing is gaining momentum with Airbus setting up operations in Vadodara, Boeing expanding in Telangana, and further developments in Nagpur. Defence manufacturing is also undergoing transformation with increased privatisation and PSU investments. All these evolving industries are accelerating demand for machine tools.

Within the machine tool industry, which specific sub-segments do you see displaying the strongest growth potential in the next two years?

My expertise lies primarily in metal cutting. Within this category, vertical and horizontal machining centres continue to see strong demand. Turning centres are comparatively mature, but horizontal machining centres still rely heavily on imports, indicating clear potential for domestic production.

High-end machine tools — such as double-column machining centres and five- and seven-axis systems — are also gaining traction. Industries like turbine manufacturing require sophisticated multi-axis capabilities, and Indian manufacturers have opportunities to expand into these advanced segments.

Are these trends closely linked to evolving requirements from end users?

Absolutely. New components and emerging technologies change the nature of precision requirements, which in turn drives product development and market expansion. As industries modernise, the demand for advanced machinery grows accordingly.

What trends are you observing in machine building, particularly in components, digitisation, automation and AI?

Two major trends stand out. First, supply chain development has become a priority. Traditionally, machine tool companies manufactured many components in-house, but now there is a clear shift towards developing external accessory and component suppliers, which strengthens the broader ecosystem.

Second, digitisation is becoming integral. Predictive maintenance, data acquisition, overall equipment effectiveness (OEE) measurement and IoT-enabled systems are now increasingly embedded in machine tools. These technologies were not widespread earlier, but the transition is accelerating.

Robotics adoption is also rising, although it will take time for India to reach the maturity levels of developed economies such as Japan and China. Nevertheless, the direction is clear, and the pace of adoption is intensifying.