India will seek to triple its exports by 2035 by reshaping its manufacturing ecosystem through structural reforms rather than large-scale subsidies, according to two government officials familiar with the plan.
Under Prime Minister Narendra Modi’s third major manufacturing push, the government will prioritise 15 sectors — ranging from high-end semiconductors and metals to labour-intensive industries such as leather — to lift annual goods exports to $1.3 trillion and accelerate economic growth.
Previous initiatives, including the 2014 Make in India campaign and a $23 billion incentive package launched in 2020, fell short of raising manufacturing’s share of GDP to the targeted 25%. Officials involved in drafting the new policy acknowledged that earlier efforts delivered only incremental gains.
“In past years, several government initiatives to boost manufacturing growth have led to modest progress at best. What is needed is a bold, focused and cohesive strategy to drive transformative change,” said one official.
Modest funding, structural focus
The government plans to spend around ₹100 billion ($1 billion) to develop infrastructure for nearly 30 manufacturing hubs across the identified sectors. An additional $218 million in grants will support advanced areas such as semiconductor fabrication and energy storage.
Unlike earlier schemes, funding will be limited, with the emphasis placed on easing regulatory and compliance burdens — widely seen as the biggest hurdle for Indian manufacturing. Financial support will be decided on a case-by-case basis, based on recommendations from a newly formed government panel, replacing pre-budget incentive packages.
The new framework, called the National Manufacturing Mission, was announced in last year’s budget, though details were not disclosed at the time. Officials said further announcements could be made in the Union Budget on February 1.
Faster clearances, coordinated policies
The proposed panel, chaired by a minister and including senior bureaucrats such as the cabinet secretary, will focus on speeding up regulatory approvals, facilitating land acquisition, and enabling cheaper financing for large projects. It will also coordinate with state governments to ensure a reliable and affordable power supply for manufacturing hubs.
Manufacturing locations have been selected based on existing infrastructure, geographic advantages and proximity to ports. The panel will also work to harmonise regulations across states, addressing long-standing issues such as divergent labour laws and multiple permit requirements that have increased costs for companies operating nationwide.
In addition, the mission will seek to cut red tape by reducing overlaps in quality and standards checks and by aligning tariffs with industry needs and national priorities.
Officials said the strategy reflects a shift from subsidy-driven industrial policy to a reform-led approach aimed at making India a globally competitive manufacturing hub over the next decade.
