India’s capital goods sector is a key driver of industrial growth, supporting infrastructure, manufacturing, and technological advancement. It accounts for 21.5% of total manufacturing, underscoring its strategic importance to the economy.

The sector spans 11 sub-segments, led by Power & Electrical Equipment, Plant Process Equipment, Earthmoving & Mining Machinery, Textile Machinery, and Machine Tools. India is the third-largest construction equipment market globally, driven by rapid urbanization and large-scale infrastructure development.

As per the Indian Electrical and Electronics Manufacturers’ Association (IEEMA), the electrical equipment segment has seen consistent double-digit growth, particularly in transmission equipment and transformers, supported by strong domestic demand and export expansion. In 2023–24, Process Plant Equipment led capital goods exports at US$1 billion, followed by Earthmoving & Mining Machinery (US$700 million), Textile Machinery (US$445 million), Food Processing Machinery (US$415 million), and Printing Machinery (US$236 million)—highlighting a diversified export base.

India is also among the top five global FDI destinations across key segments such as Plant Process Equipment, Machine Tools, Earthmoving & Mining Machinery, and Power & Electrical Equipment, reflecting strong investor confidence. The sector benefits from a liberal policy regime, including 100% FDI under the automatic route (except for countries sharing land borders with India), no industrial licensing requirements, no restrictions on technology transfer payments, and free import-export policies.

Government initiatives continue to strengthen the sector by boosting domestic manufacturing, reducing import dependence, and enhancing competitiveness. The SECC scheme supports technology upgradation, skill development, and infrastructure (including CEFCs and testing facilities), while export promotion is driven by schemes such as MOOWR, RoDTEP, EPCG, and Duty Drawback.

Reflecting on India's commitment to address environmental concerns, reduce emission intensity of its gross domestic product (GHG emissions per unit GDP) by 33%–35% over 2005 levels by 2030, and embrace sustainable transportation solutions, electric mobility is emerging as one of the cardinal segments in the automobile industry in India. It is estimated that E-Two Wheelers will reach a market of 5 Mn by 2025, with E-Three Wheelers accounting for 30% of sales.

Growing at a compounded annual growth rate of 49% between 2021 and 2030, the government anticipates the EV segment to cross annual sales of 17 Mn units by 2030. To encourage the adoption of electric vehicles, the Government of India initiated the second phase of Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in 2019. This initiative spans a period of 5 years, with a total budgetary support of INR 10,000 Cr. The primary focus is on electrifying public and shared transportation, with the aim of providing subsidies for 7262 e-Buses, 1.6 lakh e-3 Wheelers, 30461 e-4 Wheeler Passenger Cars, and 15 lakh e-2 Wheelers. The overall Electric Vehicle penetration of India is projected to grow 8x by 2030 from the current 5%. 

The National Programme on Advanced Chemistry Cell (ACC) Battery Storage, which aims to establish Gigascale ACC and battery manufacturing facilities in India, has incentivized the adoption rate of this segment, leading to a 40% surge in the number of registered EVs in 2023 compared to 2022. With an aim to go fully electric by 2030, automotive players like Tata Nexon EV, Hero Electric Vehicles Pvt Ltd (Hero Electric Eddy), Mahindra Electric Mobility Limited (Mahindra eVerito), etc. have been engaged in research and development, in addition to working towards equipment for EVs, including GPS navigation, remote sensors, anti-theft locking systems, and more. 

Bridging the gap of various challenges through the government's initiatives of charging infrastructure for electric vehicles, electric mobility in India is henceforth leaping towards a quantum surge in volumes and technology.

The Electronic Components Manufacturing sector in India is gaining significant momentum, marked by robust government support and strategic initiatives aimed at transforming the country into a global electronics hub. As of March 2023, the electronics market in India was valued at $101 Bn, with an ambitious target of reaching $300 Bn by 2025-26. The Production Linked Incentive schemes have played a pivotal role, boosting production and attracting substantial investments from major global players such as Apple and Samsung. The Ministry of Electronics and Information Technology (MeitY) has spearheaded several key initiatives, including the Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS) and the Modified Electronics Manufacturing Clusters (EMC 2.0) scheme, which aim to create world-class infrastructure and encourage investment in high-value components.

The sector has seen a notable increase in exports, with electronic goods exports reaching $29.12 Bn in FY 2023–24, marking a 23.6% rise from the previous year. The National Policy on Electronics 2019 underscores the government's commitment to developing a $300 Bn electronics manufacturing ecosystem by 2026.

Government initiatives are further supported by the Make in India and Digital India campaigns, which aim to enhance domestic manufacturing, create employment opportunities, and advance technological capabilities. Significant investments in research and development, as well as the establishment of electronics manufacturing clusters, have created a conducive environment for growth.

The focus on the Electronic Components Manufacturing sector is crucial for meeting the rising domestic demand driven by rapid digitalization and urbanization and for integrating India into the global supply chain. This sector's development is essential for driving economic growth, fostering innovation, and positioning India as a key player in the global electronics market. The government's comprehensive approach, combining policy support, infrastructure development, and incentives, underscores the strategic importance of this sector in achieving India's long-term economic and technological goals.

India’s food processing industry has been transforming rapidly, anchored in its strong agricultural base, rising domestic demand, and supportive government policies. Looking ahead, the sector is expected to play a pivotal role in positioning India as a global food hub, leveraging scale, innovation, and value addition to serve both domestic and international markets.

India’s agricultural strength is underscored by its position as one of the world’s leading producers of multiple agricultural commodities. This diversity is translating into significant opportunities for value addition within the food processing sector. As per the Second Advance Estimates for 2024–25, horticulture production has reached around 368 MMT, including 114 MMT of fruits and 220 MMT of vegetables.

India is also the largest producer and exporter of cereal products, with rice (both Basmati and non-Basmati) accounting for nearly 95% of total cereal exports. In FY 2023–24, key export destinations included Saudi Arabia, Iran, Iraq, Benin, the United Arab Emirates, and Vietnam.

To strengthen the food processing ecosystem, the Ministry of Food Processing Industries (MoFPI) has implemented a range of initiatives:
•⁠  ⁠Mega Food Parks: 41 approved with a combined processing capacity exceeding 4 MMT, of which 24 are fully operational.
•⁠  ⁠Agro-Processing Clusters: 71 approved, with 22 already operational.
•⁠  ⁠Cold Chain Infrastructure: 394 approved projects, adding over 35 MMT of storage and preservation capacity to reduce post-harvest losses.
•⁠  ⁠Food Safety & Quality Assurance: 209 facilities established to ensure compliance with domestic and international food standards.

A vibrant food processing sector is central to transforming Indian agriculture by diversifying production, extending shelf life, and enhancing the value of farm output. It generates large-scale employment, improves farmer incomes, and enables greater integration into global markets. With sustained policy support and accelerated infrastructure development, India’s food processing industry is well positioned to emerge as a key driver of global food supply chains.

India's pharmaceutical sector is driven by a robust scientific and technological base, leading globally as the largest vaccine producer, accounting for ~60% of global vaccine production and supplying to over 150 countries. Major segments of the pharma sector in India include generic drugs, OTC medicines, bulk drugs, vaccines, contract research and manufacturing, biosimilars and biologics. With pharma exports standing at $30.4 Bn in FY 2024–25 and the USA and Europe being the largest export destination for Indian pharmaceuticals, the industry is propelled by an ambition to achieve a $450 Bn market by 2047. The pharmaceutical manufacturing landscape and India's economic growth potential attract investments into the sector, making the pharmaceutical sector the ninth largest segment in attracting FDI inflows till March 2025. 

With 9 of the world’s top 25 generic manufacturers being Indian, India manufactures 500+ Active Pharmaceutical Ingredients (APIs) and produces 60,000 generic brands across 60 therapeutic categories. In FY 2024–25, India’s pharmaceutical exports reached $30.4 Bn, with imports at $8.9 Bn, resulting in a positive trade balance of $21.5 Bn. Exports span 200+ countries, with top destinations including North America (especially the USA), Latin America, Europe, and Africa, and the majority of exports fall under drug formulations and biologicals.

India is the world’s largest provider of generic medicines, accounting for 20% of the global supply. Every year, almost half  of finished generic dosage forms manufactured in India are exported. The country is also a global vaccine powerhouse, fulfilling 60% of global demand and supplying vaccines to 150+ countries, including 301 Mn COVID-19 doses to 101 countries by mid-2023. India remains a global leader in BCG, DPT, and measles vaccines.

The country is also making significant strides in biosimilars development, with over 200 in the pipeline. Reforms such as the 2019 New Drug and Clinical Trial Rules have streamlined regulatory timelines, while India’s demographic diversity and infrastructure strength have made it the 3rd most preferred destination for clinical trials globally. With over 94,000 clinical trials registered by 2025, India’s pharmaceutical sector continues to drive cost-effective innovation, ensuring access to affordable and high-quality healthcare worldwide.

India's energy landscape has undergone a remarkable transition, with the nation achieving an unprecedented ~50% of its installed electricity capacity from non-fossil fuel sources by July 2025 - five years ahead of its 2030 commitment under the Paris Agreement. As the world repositions itself towards sustainability, India's renewable sector has unleashed extraordinary growth opportunities, positioning the country as a global leader in clean energy adoption. Over the past decade, India has made transformational strides in diversifying its energy mix, substantially reducing dependence on conventional fossil fuels while maintaining its enhanced target from COP26 of 500 GW of non-fossil fuel-based energy by 2030.

India's installed non-fossil fuel capacity has witnessed an extraordinary rise from 81 GW before 2014 to 250 GW in September 2025, representing a three-fold increase that establishes India as the 4th largest globally in renewable energy installed capacity. Solar power has experienced a remarkable 42-fold surge in adoption, with installed capacity increasing from 2.82 GW in 2014 to 123.13 GW as of August 2025. The government's commitment to creating a sustainable world and scaling up solar capacity through initiatives like the International Solar Alliance reflects the country's potential to harness solar power in collaboration with more than 120 signatory countries.

In addition, 100% FDI has been allowed under the automatic route for renewable energy generation and distribution projects, with the sector receiving $23 billion in foreign investment from April 2020 to June 2025. India, at COP26 in November 2021, announced its target to achieve net zero by 2070, positioning the renewable energy sector as a catalyst for vast potential beyond creating a cleaner future. Wind energy capacity has increased 2.5 times from 21 GW in 2014 to 52.68 GW by August 2025, with India targeting expansion to 99.9 GW by 2029-30 across major wind energy-producing states including Andhra Pradesh, Gujarat, Karnataka, Maharashtra, and Rajasthan.

The government has launched several flagship initiatives, including 50 solar parks across multiple states with capacities of 500 MW or more, and the PM Surya Ghar: Muft Bijli Yojana targeting 1 crore rooftop solar installations. The Sustainable Alternative Towards Affordable Transportation (SATAT) initiative promotes Compressed Bio-Gas (CBG) production plants, while the Smart Cities Mission includes mandatory rooftop solar provisions and 10% renewable energy requirements for end-customers. India achieved a record 22 GW of renewable energy capacity addition in the first half of 2025 alone, marking the highest-ever six-month installation period.

The shift towards renewable energy represents a focal point for inclusive growth, with renewable energy generation rising from 190.96 BU in 2014-15 to 403 BU in 2024-25, creating unprecedented job opportunities and positioning India to lead global sustainable development.

With rising per capita income, presently around $2,800, India boasts the second-largest working population with a median age of 28 years. The textile industry in India, thus, gains a pivotal role in knitting the tapestry of dynamism and growth of the sector with about a 4.5% share in the global textile and apparel trade. With a diverse range of fabrics and intrinsic craftsmanship, the textile sector offers a wealth of opportunities. India possesses the capability to manufacture the entire value chain, and its products are exported to more than 100 countries. The sector provides employment to over 45 Mn people and produces about 22,000 Mn pieces of garments per year, with the market size projected to reach $350 Bn by 2030, from the current $174 Bn. With transformative changes in the textile sector, the government has also launched the PM MITRA Park Scheme with an outlay of INR 4,445 Cr to create an integrated textiles value chain from spinning to manufacturing at a single location. In line with the growth roadmap, the Indian textile market currently ranks fifth globally, and the government is actively working to accelerate this growth to a rate of 15-20% over the next five years. Moreover, the sector acts as a crucial link between the agriculture and industrial sectors, supporting the cultivation of cotton, silk, and other natural fibres and thus bridging the gap.

Recently, the government of India has also taken up initiatives to enhance cotton production. Kasturi Cotton, launched by the Ministry of Textiles, is a first-of-its-kind branding, traceability, and certification exercise carried out jointly by the Government of India, trade bodies, and industry to promote Indian cotton. Stakeholders across the supply chain, including farmers, ginning units, spinning mills, processing houses, weaving units, garmenting units, home textile manufacturers, and even retailers and brands, will be involved in a collaborative effort to promote and enhance the value of Indian cotton across the domestic and overseas markets. The government has also taken key initiatives, like the Production-Linked Incentive Scheme, to promote the production of MMF apparel, MMF fabrics, and technical textile products in the country.  With a view to enhancing the skills of the workforce in the textile sector, the Samarth Scheme has been formulated under a broad skilling policy framework with the objective of providing opportunities for sustainable livelihood.