In a country as diverse and dynamic as India, economic growth and industrial self-reliance have always been critical goals. Recognizing the immense potential of India’s demographic dividend, geographical positioning, and entrepreneurial spirit, the Government of India launched the "Make in India" initiative on September 25, 2014. With an aim to transform the country into a global manufacturing hub, this campaign was envisioned as a strategic initiative to attract domestic and foreign investment, foster innovation, enhance skill development, and build world-class manufacturing infrastructure. Over a decade has passed since its inception, and it is now an apt moment to critically examine the progress of the initiative and assess the prospects that lie ahead.
The Make in India initiative was built on the pillars of boosting manufacturing, enhancing job creation, and improving the country’s global competitiveness. It targeted key sectors such as automobiles, textiles, electronics, pharmaceuticals, defense manufacturing, and renewable energy, among others. At the heart of this initiative was the commitment to improve the ‘Ease of Doing Business’ in India by simplifying processes, reducing red tape, and creating a more investor-friendly environment. The government actively worked toward digitizing business approvals, launching single-window clearance systems, and strengthening intellectual property rights regimes to instill confidence among investors.
One of the most remarkable successes of the Make in India campaign has been the significant rise in foreign direct investment (FDI) inflows. India has consistently ranked among the top global FDI destinations since the campaign’s launch. According to government data, India recorded its highest-ever FDI inflow during the fiscal year 2021-22, standing at $83.6 billion. This can be attributed to reforms across sectors and policy initiatives encouraging 100% FDI in various industries under the automatic route. Major global players in electronics, automotive, and mobile phone manufacturing have either entered the Indian market or expanded their operations here. The success of mobile phone manufacturing, with India becoming the second-largest producer of mobile handsets in the world, is a shining example of this shift.
Another area of notable development has been the emergence of India as a key player in the global supply chain. The COVID-19 pandemic exposed the vulnerabilities of overdependence on a single country for manufacturing, and companies began diversifying their manufacturing bases. India was quick to seize this opportunity. The government launched the Production-Linked Incentive (PLI) scheme in several sectors, including electronics, pharmaceuticals, and solar PV modules, to make India more competitive. This scheme offered performance-based incentives to companies, thereby reducing the cost disadvantages faced by Indian manufacturers and encouraging economies of scale. As a result, India has become a serious contender in attracting supply chain relocation and manufacturing investments, particularly from multinational companies looking to reduce reliance on Chinese production networks.
Infrastructure development, a prerequisite for robust manufacturing, has also witnessed significant focus. Initiatives like the National Infrastructure Pipeline and Gati Shakti have aimed to improve multi-modal connectivity, ease logistics bottlenecks, and create industrial corridors. Smart cities, dedicated freight corridors, and improved port connectivity have begun transforming the manufacturing landscape of the country. Furthermore, with the rise of digital India, a parallel push toward digitization has made government processes more transparent, accessible, and faster, benefitting businesses across sectors.
Yet, while the progress has been significant, the journey has not been devoid of challenges. One of the key criticisms leveled against the Make in India initiative is the underperformance of the manufacturing sector in terms of its contribution to GDP. The original goal was to increase the manufacturing sector's contribution from around 16–17% to 25% of GDP by 2022. However, this target remains unmet. The manufacturing sector continues to contribute about 17% to India’s GDP, reflecting a structural challenge that demands urgent policy attention. In addition, global economic uncertainties, disruptions in supply chains, and the economic impact of the pandemic posed severe roadblocks in meeting the initiative’s ambitious targets.
Moreover, India's labor laws, while undergoing reforms, still present complications. Despite the introduction of the four labor codes aimed at streamlining archaic labor legislation, the implementation across states has been uneven. The informal nature of India’s workforce and lack of adequate social security measures continue to hinder the establishment of a stable and productive labor market. Skilling also remains a significant concern. While India boasts a young population, a vast majority of them lack the technical training or vocational skills required for the modern manufacturing sector. Skill India and similar programs have aimed to address this issue, but results remain below expectations, calling for renewed investment in education and industry-relevant training programs.
Another important issue lies in the complexity of India's regulatory environment. Although progress has been made, several hurdles still remain in terms of land acquisition, environmental clearances, and tax compliance. For smaller businesses, navigating this regulatory maze can be daunting. Furthermore, a uniform and well-coordinated approach across central and state governments is crucial for the successful implementation of reforms, but this synergy has often been found lacking. Different interpretations of central policies and delays in approvals at the state level can disincentivize investors and derail projects.
In addition, India must compete with other emerging economies that are also aggressively promoting themselves as global manufacturing destinations. Countries like Vietnam, Indonesia, and Bangladesh offer cost advantages, favorable labor conditions, and streamlined regulations that attract investors. For India to stay ahead in this competitive landscape, it must double down on reforms, reduce operational costs, and ensure predictability in policy frameworks.
Despite these challenges, the prospects of Make in India remain promising. India enjoys several inherent advantages that can work in its favor. A massive domestic market, rising consumer demand, a demographic dividend, a stable democratic political system, and a robust legal framework make India a desirable destination for investors. Furthermore, the government’s continued commitment to reform indicates a positive trajectory. The push for Atmanirbhar Bharat, or self-reliant India, has further reinforced the goals of Make in India by promoting indigenous manufacturing, reducing import dependency, and strengthening local supply chains.
As India embraces emerging technologies such as Artificial Intelligence, Industry 4.0, and the Internet of Things (IoT), the integration of these technologies into manufacturing processes can propel productivity and competitiveness. Initiatives to foster innovation through schemes like Startup India and investments in research and development can accelerate the creation of high-value products and advanced manufacturing capabilities. Additionally, partnerships with academic institutions, industry stakeholders, and international collaborators can create a vibrant ecosystem of innovation-led industrial growth.
India's strategic role in the Indo-Pacific region also lends it considerable geopolitical leverage. As tensions and uncertainties persist in global politics, many countries are actively looking to develop alternative trade and manufacturing alliances. India can benefit immensely by positioning itself as a neutral, reliable, and quality-centric manufacturing partner in the global value chain. Trade agreements such as the India-UAE Comprehensive Economic Partnership Agreement (CEPA) and India's participation in QUAD and other regional groupings provide opportunities to access new markets and diversify export destinations.
In the long run, the success of Make in India will not merely be measured by FDI figures or the number of factories set up, but by the structural transformation of the Indian economy—one that leads to inclusive growth, generates sustainable employment, empowers small and medium enterprises, and ensures that manufacturing becomes a true engine of the nation’s development. Policymakers must remain focused, adaptable, and responsive to changing global trends and domestic requirements. In the coming years, a fine balance must be maintained between growth and sustainability, innovation and regulation, and speed and inclusivity.
As the country moves toward its vision of becoming a $5 trillion economy, the Make in India initiative continues to be a cornerstone of its developmental agenda. With a renewed push toward reforms, a focus on long-term capacity building, and a spirit of cooperative federalism, India has the potential not just to meet its manufacturing goals, but to emerge as a leader in the global economic order. The next decade will be crucial. The decisions made today, and the steps taken in this direction, will determine whether Make in India becomes a short-lived slogan or a long-lasting movement shaping India’s industrial destiny.
(Views are personal. Email - himangshur1989@gmail.com)
