The Government of India (GoI) has been aiming to increase the contribution of manufacturing to total GDP from around 17% to 25% for the last many years. To achieve it, GoI has rolled out various initiatives like Aatmanirbhar Bharat/Make in India, Production- linked Incentives (PLI) scheme, low corporate tax rates for new manufacturing units, etc along with improving the logistics network via Gati Shakti mission, multi-modal connectivity, etc. Despite efforts, manufacturing’s share of the economy has not significantly increased, remaining at around 17%.

As per the Commerce Ministry data, India's exports of goods and services rose marginally by 0.4% to $ 765.6 billion in CY2023 despite global economic uncertainties, but goods exports contracted by 4.71% to $ 431.9 billion. Overall, India ranked 17 th globally in exports, with a 1.8% share in world trade. On the import front, the country is ranked 8 th , holding a 2.8% share in global trade.

The on-going US-China trade conflict and China-Plus-One policy present a big opportunity for India to present itself as a manufacturing hub for the world. But, it has to compete with other emerging countries like Vietnam, Thailand, Bangladesh, etc to increase its manufacturing pie in the global market.

The Asian Development Bank (ADB), which has raised India's GDP growth forecast for the current fiscal to 7% from 6.7% earlier, expects the growth momentum to pick up in FY2025, backed by improved goods exports and an increase in manufacturing productivity and agricultural output. At the same time, the volume of world merchandise trade is expected to increase by 2.6% in 2024 and 3.3% in 2025 after witnessing a contraction of 1.2% in 2023, according to a World Trade Organization (WTO) report. However, regional conflicts, geopolitical tensions and economic policy uncertainty pose substantial downside risks to the forecast.

With PM Narendra Modi-led government coming back to power for the third consecutive time, the industry expects the continuity in policymaking to have a positive impact on the manufacturing sector as well.

Against this background, Smart Manufacturing & Enterprises (SME) will be hosting a webinar on “Can India Build Global Manufacturing Capabilities” on June 21, 2024 at 3.30 PM to 5 PM.