India’s goal is to double GDP’s manufacturing share to reach 23% of the sunrise sector: FM

Union Secretary of Finance and Corporate Affairs Nirmala Sitharaman gave a keynote speech at the “viksitbharat” Foundation in India on April 22, 2025 at the Hoover Institution in California, USA. | Image Source: PTI

Finance Minister Nirmala Sitharaman said on Monday (April 22, 2025) that India plans to increase its share of the manufacturing sector from 12% to 23% over the next two decades, aiming to create jobs and drive economic growth.

India focuses on identified sunrise sectors such as semiconductors, renewable energy components, medical equipment, battery and labor-intensive industries, including leather and textiles, to strengthen GDP’s manufacturing share, she said during the Hoovover Institution at Stanford University in California.

For India, she said, “expanding manufacturing is crucial to absorbing young labor, reducing import dependence and building a competitive global supply chain”.

She observed that from the perspective of Industrial Revolution 4.0, the world is fully resetting manufacturing, and India is also witnessing changes.

“In India’s GDP, the service sector contributes about 64%, and if that’s on one hand, then on the lower end, the gig economy is growing rapidly. In fact, if there are 7.1 million people today in the gig economy today, as of 2021-22 data, we expect that by 2030, that will reach 230 million.” She said that this is not made. ”

“So the service sector contributes both to GDP and employment … but that’s not to say that manufacturing should be put on hold. We have always wanted to increase the contribution of manufacturing from 12% to about 22-23%.”

The government has identified 14 sunrise sectors – semiconductors, renewable energy components, medical equipment, hydrogen tasks, batteries, etc. to strengthen the manufacturing industry and introduce incentive schemes (PLI) programs linked to production to promote them.

PLI is provided to sectors with greater employment potential, such as electronics, and similar labor-intensive fields such as textiles and leather.

She said it stresses the importance of manufacturing, which restrains society and imparts cohesion to cohesion by providing employment opportunities and financial strength to communities.

She said that for long-term growth, manufacturing is the key engine of transformation.

“Historically, manufacturing has been the cornerstone of East Asia’s economic transition from the 19th century Britain to the 21st century. It creates forward and backward connections, catalyse skills and drives the need for infrastructure and governance reforms,” she said.

Ms. Siharamman said that in the recent relationship between the Trump administration’s impact on India and its impact on India, policy consistency, tax system, investment and growth predictability can be planned and implemented to a large extent when the government is stable.