India's manufacturing sector continues to show strong momentum, with the purchasing managers' index (PMI) rising to 58.2 in April, up from 58.1 in March. This growth, driven by robust export orders as well as domestic and foreign demand, marks the fastest pace of growth in the last 10 months. Additionally, industrial production increased by 3% year over year in March 2025.
According to a recent Crisil report, India’s car industry is expected to achieve a record cumulative domestic and export volume of 5 million units in the current fiscal year despite a slowdown in the annual growth rate to 2%-4%. Overall, automobile exports surged by 19%, reaching 5.3 million units in the last fiscal year, compared to 4.5 million units the year before. Domestic commercial vehicle volumes are projected to reach one million units this fiscal year.
The electronics manufacturing sector in India has grown fivefold over the last decade, surpassing $128 billion in the last fiscal year. Exports have seen a sixfold increase, exceeding $38 billion. India is focused on expanding its design ecosystem and locally developing advanced technologies, including AI-enabled cameras, telecommunication technologies, and power electronics. India’s value add to electronics manufacturing has significantly increased from 30% to 70%. Furthermore, incentives worth over $2.5 billion have been planned to enhance the manufacturing value chain.
Due to a favorable tariff structure, Apple has shifted iPhone production for the U.S. market from China to India, while sourcing other products from Vietnam.
Ember's Global Electricity Report noted that India surpassed Germany to become the world’s third-largest producer of wind and solar energy in 2024, when wind and solar energy accounted for 15% of global electricity generation. In India, clean energy accounted for 22% of the country’s electricity generation. Hydropower led at 8%, followed by wind and solar at 10%. Notably, solar energy alone accounted for 7% of the country's electricity generation. India added 24 GW of solar capacity in 2024, more than doubling the previous year's addition, making it the third-largest market after China and the United States.
A few recently announced projects and investment news items are listed below for your reference.
The Ministry of Defence signed a $7.5 billion contract with Hindustan Aeronautics Limited (HAL) to supply 156 light combat Prachand helicopters. The air force will be supplied with 66 units, and the remaining 90 will be supplied to the army. These will be produced at HAL’s manufacturing facility based in Tumkuru, Bengaluru.
India signed a $7.5 billion deal to supply 26 Rafale Marine carrier-based aircraft. Of those, 22 will be single-seaters, and the remaining four will be twin-seaters.
UNO Minda is setting up a greenfield EV powertrain component manufacturing facility under a joint venture with Suzhou Inovance Automotive. Uno Minda will hold a 70% stake in the JV. The plant will produce a range of components like combined charging units, e-axles, inverters, and motors for passenger and commercial EVs.
Case Construction Equipment (CCE) aims to make its India-based manufacturing facility in Pithampur its global hub for construction equipment production. Currently, the plant accounts for nearly half of CCE’s revenue from exports, with machines shipped to over 120 countries. The plant can manufacture one machine every 16 minutes, producing up to 18 backhoe loaders and six compactors daily.
Tata Power is setting up a 4.3 GW solar cell and module plant in Tirunelveli, Tamil Nadu.
For more information, please contact Arun Mahajan at AMahajan@AMTonline.org.
