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China slowdown opens $25 billion tools export opportunity for India: Niti Aayog
Industry News- Apr 16,25
India currently exports around $600 million in hand tools and $425 million in power tools, a fraction of the global market which was valued at $100 billion in 2022 and is projected to reach $190 billion by 2035.
India has a unique opportunity to transform its modest share in the $100 billion global tools market into a $25-billion export-driven industry by 2035, according to a new report by Niti Aayog. The report, titled Unlocking $25+ Billion Exports: India’s Hand & Power Tools Sector, identifies China’s waning cost advantage and mounting tariffs as a key opening for India to strengthen its global manufacturing footprint.
India currently exports around $600 million in hand tools and $425 million in power tools, a fraction of the global market which was valued at $100 billion in 2022 and is projected to reach $190 billion by 2035. China currently controls nearly half of this market, but rising costs and shifting trade dynamics are eroding its dominance.
The report, prepared in partnership with the Foundation of Economic Development, lays out a three-pillar strategy to scale up India’s tools sector:
1. Developing global-scale industrial clusters
2. Removing structural cost disadvantages (estimated at 14–17%)
3. Providing targeted policy support based on global best practices and local needs
Niti Aayog evaluated 18 states for this study, highlighting the role of states like Punjab and Maharashtra, which have potential to become key hubs for tool manufacturing. The tools industry—vital to sectors such as infrastructure, automotive, and construction—is also seen as a vehicle for inclusive growth, particularly in empowering MSMEs.
The think tank emphasized the need for public-private collaboration, export promotion policies, and skill development to build globally competitive capabilities. With low-cost labour, a growing manufacturing base, and strategic trade positioning, India can emerge as an attractive alternative to China in the global supply chain.
“India stands at a defining juncture in its economic journey,” the report concludes. “With bold reforms and strategic execution, the tools industry can unlock billions in exports while driving job creation and regional development.”
(Mint)
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