India Advanced Manufacturing
India’s advanced manufacturing sector is undergoing a major transformation through robust government investment in automation, robotics, and Industry 4.0 technologies. With more than $165 billion invested till 2024 and new U.S.-India strategic tech partnerships, there is growing demand for U.S. exports in industrial automation, AI, IoT, and robotics technologies and services. Despite some challenges, the surge in demand across multiple sectors—including automotive, aerospace, ICT, and pharmaceuticals—makes this a prime opportunity for U.S. companies with smart manufacturing solutions.
According to the World Robotics 2024 report by the International Federation of Robotics, India ranks seventh worldwide in terms of annual installations – a key indicator of an automating and advancing manufacturing sector. Invest India, the National Investment Promotion and Facilitation Agency of India, has predicted that the India’s industrial robotics market will reach around $264 million by 2028 at a CAGR of 2.92%.
The Government of India’s (GOI) push to adopt advanced technologies—including automation, robotics, IoT, AI, and data analytics—is accelerating its Industry 4.0 ambitions. Launched in 2020 with a $24 billion budget, the Production Linked Incentive (PLI) scheme, targets 14 critical sectors, chosen to enhance India’s manufacturing capabilities and foster technological advancements. A positive outcome of these initiatives is that the contribution of India’s manufacturing sector to the Gross Value Added (GVA) is expected to grow from 14% in 2025 to around 21% in 2032 according to a December 2024 article in the Economic Times.
President Trump and Prime Minister Modi’s February 2025 announcement of the U.S.-India TRUST (Transforming the Relationship Utilizing Strategic Technology) initiative has also marked a new era of cooperation on emerging and critical technologies. TRUST is aimed at expanding collaboration in key areas such as defense, artificial intelligence, semiconductors, quantum, biotechnology, energy, and space. With the growth in manufacturing and the launch of TRUST, opportunities for U.S. robotics and automation stakeholders to do business in the Indian market will grow.
Another notable government initiative is Smart Advanced Manufacturing and Rapid Transformation Hubs or SAMARTH Udyog Bharat 4.0 announced by the GOI’s Ministry for Heavy Industries & Public Enterprises to enhance competitiveness in the capital goods sector. Together with the PLI scheme and Digital India, these contributed $165.1 billion of investment into India’s manufacturing sector in 2024.
Despite this promising landscape, companies face several challenges: high initial investment, unreliable infrastructure, lack of standards coherence, lax intellectual property rights protection and enforcement, non-transparent and unpredictable regulatory policies, and price sensitivity.
Opportunities for U.S. Companies
There is a shift in the focus of Indian industry to more automated and process driven manufacturing. Companies previously dependent on labor intensive practices are now looking towards increased automation to minimize uncertainties and maximize productivity. The need to reduce the competitive gap and to gain from shifting dynamics of developing manufacturing supply chains in India has led India on the path towards adopting more technology in its manufacturing processes.
The opportunities outweigh the challenges as India is poised for substantial growth driven by technological advancements, increasing demand across various sectors, and supportive policies by the government that will help bolster and develop its manufacturing infrastructure and competitiveness. The government and private sectors’ consistent investment in skill development and innovation will help U.S. companies harness the potential of this dynamic industry in India. India churns out a million engineering graduates every year, in addition to technically qualified workers. Integrating this talent into the existing 27.3 million strong manufacturing sector workforce will help bridge the skills gap and support the country’s industrial transformation.
India harbors a strong and diverse presence of end-use industries. Among those utilizing, investing, interested in robotics and automation to boost production in their market include industries such as automotive, aerospace and defense, information and communication technology, electronics and electricals, metals and machinery, plastic and chemicals, food and beverages, pharmaceuticals, and cosmetics.
The integration of artificial intelligence and emerging demand for industrial robots, such as articulated robots, Selective Compliance Assembly Robot Arm (SCARA) robots, cartesian robots, Autonomous Mobile Robots (AMR), and Collaborative Robots (Cobots), further support the demand for smart manufacturing solutions in India.
U.S. companies entering the Indian market should identify quality reliable local partners with deep market knowledge, have a strong distribution network, and experience in procurement practice. Long term strategic planning, due diligence, and consistent follow-ups are essential for doing business successfully in India.
The U.S. Commercial Service team in India can help with your market entry strategies. If you wish to pursue market opportunities in this region, please connect with your nearest local U.S. Commercial Service office in the U.S. to schedule an appointment for a consultation or contact the advanced manufacturing team at the U.S. Commercial Service in India.