India’s industrial growth accelerates with strong manufacturing and EV momentum

Press Release, 30 January 2026

India’s industrial sector showed robust growth in the first half of the 2025-26 fiscal year, with the latest Economic Survey 2025-26 revealing a 7.0 % year-on-year increase in industry Gross Value Added (GVA), signaling renewed momentum after a slowdown in the previous year. Manufacturing activity was particularly strong, expanding by 7.72 % in Q1 and 9.13 % in Q2, driven by structural shifts toward higher-value production, improved infrastructure, and greater adoption of technology across firms. Medium and high-tech sectors now contribute nearly half of India’s total manufacturing output, thanks in part to initiatives like the Production Linked Incentive schemes and the India Semiconductor Mission. As a result, India’s ranking in the Competitive Industrial Performance Index improved to 37th in 2023, up from 40th the year before.

The survey highlighted several sectors maintaining strong growth. Core industries, including steel and cement, continued their upward trajectory, while coal production reached a record 1,047.52 million tonnes in FY25. The automotive industry also recorded impressive progress, with production growing nearly 33 % over the last decade (FY15–FY25), supported by government measures to boost electric vehicle (EV) manufacturing and adoption. This includes various schemes such as the PLI for automobile and auto component manufacturing, battery storage incentives, and programs focused on electric passenger cars and buses. The electronics and mobile manufacturing sectors have similarly undergone significant transformation, with electronics rising from the seventh to the third largest export category between FY22 and FY25. The Economic Survey underscored that future industrial growth will hinge on increased private investment in R&D, technology adoption, and integration into global value chains, moving beyond import substitution toward greater competitiveness.

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