Engineering India’s Self-Reliance: Building the Next Generation of Advanced Manufacturing

India has a significant opportunity ahead. If the country can combine its manufacturing scale with advanced technologies, engineering capabilities and a future-ready workforce, it can build a manufacturing ecosystem that is not only more self-reliant, but also more competitive on the global stage.

September 10, 2026. By News Bureau

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articles

Nash Industries

Parthasarathy K

Significant opportunity

Make in India

Atmanirbhar Bharat mission

Frontier Technologies

Automotive technologies

Viksit Bharat 2047

For decades, low labour costs and high volumes were the main drivers of India’s domestic manufacturing sector. While cost competitiveness and economies of scale remain crucial, they are no longer enough for the country to stay ahead of its competitors and strengthen its position as a preferred manufacturing destination.

Self-Reliance and ‘Make in India’

As the Central Government promotes its Atmanirbhar Bharat mission, the path towards self-reliance in manufacturing goes well beyond increasing domestic production. It is increasingly centred on building advanced engineering capabilities through automation, precision engineering, Industry 4.0 practices, smart factories and other technologies that can transform India into a globally competitive manufacturing hub.

In this context, much has been written about the ‘Make in India’ programme. Despite partial success on several fronts, it has fallen short of India’s broader manufacturing ambitions. Indian manufacturing currently accounts for 15–17 percent of GDP. By 2035, the ‘Make in India’ mission aims to increase manufacturing’s share of GDP to 25 percent. NITI Aayog’s vision document, Reimagining Manufacturing: India’s Roadmap to Global Leadership in Advanced Manufacturing, also offers a time-bound roadmap for the country to become an advanced manufacturing powerhouse by 2035.

Today, across manufacturing sectors and industries, competitiveness is increasingly influenced not just by what happens on the factory floor, but by the quality of the data available to make decisions. Demand forecasting, predictive maintenance, precise quality control and dynamic supply chain management are becoming critical to manufacturing performance.

In this landscape, artificial intelligence is set to play an increasingly important role in reshaping Indian manufacturing. In 2025, the AI in manufacturing market in India was pegged at USD 860 million. By 2030, this is anticipated to reach USD 4.89 billion, representing a CAGR of 41.5 percent.

The role of predictive maintenance warrants specific mention. In traditional manufacturing, machines are often scheduled for servicing every 500 hours, every 30 days, or after a breakdown. Such approaches can either lead to over-maintenance, resulting in unnecessary costs, or under-maintenance, increasing the risk of unplanned downtime that can disrupt production schedules and impact margins.

AI-enabled manufacturing practices, on the other hand, can continuously monitor sensor data from machinery, including vibration, temperature variations, power consumption and acoustic signatures. This enables early signs of equipment failure to be identified, sometimes days or weeks in advance, allowing maintenance to be scheduled at the appropriate time. As a result, predictive maintenance has become one of the most widely used applications of AI in manufacturing, with well-implemented solutions delivering reductions in unplanned downtime of up to 50 percent.

Deploying Frontier Technologies

The role of manufacturing in India is critical, driving economic growth, employment generation and global competitiveness. If India is to meet its Viksit Bharat@2047 goal, incremental improvements in manufacturing will not be enough. A broader shift is required, enabled by advanced technologies, innovation and engineering excellence, to reimagine factories, supply chains and allied infrastructure.

Frontier technologies driving this change will include AI, automation, robotics, digital twins, smart grids, 3D printing and more.

‘Make in India’ must provide a substantial boost to manufacturing so that India can compete more effectively with established and emerging manufacturing destinations such as Vietnam, China and Mexico. The adoption of AI and other advanced technologies in manufacturing must be scaled up significantly to achieve these objectives.

Fortunately, the Government of India is already working towards this goal. In September 2025, a partnership was formed between IBM and the Central Government under the IndiaAI Mission. The partnership aims to leverage AI-enabled solutions across domestic manufacturing segments to improve India’s overall productivity and competitiveness.

Against this backdrop, the domestic precision manufacturing sector is also experiencing strong growth. Rapid global advances in infrastructure development and industrial automation are driving an increasing demand for precision tools. By 2027, Tecnova estimates that the domestic precision tool market will expand at a CAGR of 13.6 percent to reach USD 102 billion.

However, given their high manufacturing costs, precision tools remain out of reach for many small and medium-sized firms. Greater domestic manufacturing of precision tools could help address this challenge, particularly as local production costs can be lower than those in other developing countries.

Grabbing a Historic Opportunity

Today, India has a historic opportunity to adopt frontier technologies across key sectors, including automotive, pharmaceuticals, medical devices, chemicals, textiles, food processing, semiconductors, aerospace, defence, railway equipment and renewable energy equipment.

If India fails to embrace these technologies at scale, it risks losing an additional USD 270 billion in manufacturing GDP by 2035 and USD 1 trillion by 2047. Beyond the economic impact, the country could also miss a significant opportunity to emerge as a global manufacturing leader, while increasing its reliance on imports of critical technologies.

However, if India is able to harness these technologies effectively, it will also be better positioned to leverage its demographic dividend by creating employment opportunities across diverse domains.

Between 2026 and 2035, a series of comprehensive reforms and initiatives can help India build a future-ready manufacturing industry led by frontier technologies. Industries such as AI, cloud, clean energy, aerospace, advanced electronics and next-generation automotive technologies could collectively generate USD 1.4 to USD 1.9 trillion in GDP growth by 2035.

India has a significant opportunity ahead. If the country can combine its manufacturing scale with advanced technologies, engineering capabilities and a future-ready workforce, it can build a manufacturing ecosystem that is not only more self-reliant, but also more competitive on the global stage.

If implemented well, these efforts can help the manufacturing sector make a meaningful contribution towards making Viksit Bharat@2047 a reality.

- Parthasarathy K, CTO, Nash Industries