UPSC Mains
GS Paper III
Indian Economy
GS-II: Government Policies
Make in India at 12 Years: A Patchy Performance Report
Twelve years after its 2014 launch, Make in India’s own government data shows manufacturing’s share of GDP still trailing the 25% target and export competitiveness stagnant since 2013.
Manufacturing GVA Share
15.6% (new series) vs 25% target
Global Export Share
Stagnant at ~1.7% since 2013
PLI Investment Concentration
83% in just 5 sectors
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Why in News
- Make in India, launched on September 25, 2014, has completed 12 years.
- Recent analysis shows that despite various government initiatives, manufacturing has not significantly increased its share in growth, employment or global exports, with progress largely limited to a few sectors.
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About the Make in India Campaign
- Launched September 25, 2014, with the objective of transforming India into a global manufacturing hub.
- Core aim: increase manufacturing’s contribution to GDP, boost employment generation, attract higher foreign investment.
- Twelve years later, this analysis uses official government data (GVA figures, Index of Industrial Production/IIP, export data, RBI statistics) to evaluate how well these goals were achieved.
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Growth Performance: Manufacturing vs Overall Economy
- Under the old GVA series, manufacturing grew faster than the overall economy in only 6 of the 12 years.
- Under the new GVA series, manufacturing has outpaced overall growth in all three years for which data is available (2023-24 to 2025-26) — but this gap is shrinking rapidly, indicating weakening momentum.
- IIP data is starker: under the old IIP series, manufacturing outpaced the overall index in only 3 of 12 years.
- Under the new IIP series, manufacturing matched the overall index in 2023-24 but was slower in the following two years.
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Manufacturing’s Share in the Economy (GVA Data)
- Under the older GVA series, manufacturing’s share of overall GVA was actually lower in 2025-26 than at Make in India’s 2014 launch.
- The new GVA series shows a marginal rise, from 14.6% (2022-23) to 15.6% (2025-26).
- Even so, this remains far below the government’s original 25%-of-GDP target — repeatedly missed.
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Export Performance
- India’s non-petroleum goods exports grew 53%, to $388.3 billion in 2025-26 from $253.5 billion in 2014.
- In the 12 years before Make in India, non-petroleum exports had grown by more than 400% (on a smaller base).
- UNCTAD data: India’s share of global merchandise exports grew from ~0.8% (2002) to 1.7% (2013), but has essentially stagnated at that level even by 2025-26.
This stagnation is a critical indicator — absolute export growth hasn’t translated into greater global competitiveness.
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Investment Trends: Gross Fixed Capital Formation (GFCF)
- Private-sector GFCF formed a lower share of GDP in 2023-24 (latest old-series year) than in 2014-15.
- The new GFCF series confirms a declining trend — private investment as % of GDP has been falling since 2022-23.
- Sustained private investment is essential for long-term manufacturing growth and job creation.
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Foreign Direct Investment (FDI) Trends
- FDI growth into manufacturing was slower than overall FDI growth in 7 of the 12 years.
- However, manufacturing’s share within overall FDI rose from ~48% (2014-15) to 55% (2025-26) — a relative shift in investor preference despite inconsistent absolute growth.
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Capacity Utilisation and Bank Credit
- RBI data: capacity utilisation has been slowly increasing but still remains below the 80% mark (the threshold beyond which firms typically invest in new capacity).
- Bank credit to industry has been growing strongly, especially to MSMEs.
- Experts caution that, absent sustained rapid industrial output growth, this suggests loans are being used for working capital rather than fresh capital investment — a less optimistic sign.
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Performance of Production-Linked Incentive (PLI) Schemes
- 14 PLI schemes (launched 2020-2021) together achieved cumulative investment of ₹2.4 lakh crore as of March 2026.
- Highly concentrated: top 5 sectors account for ~83% of all PLI investment — solar modules, pharmaceutical drugs, automobiles & components, specialty steel, large-scale electronics manufacturing.
Solar Modules
Among the top 5 sectors driving PLI investment concentration.
Pharmaceutical Drugs
A leading recipient sector under the PLI scheme framework.
Automobiles & Components
Significant share of the ₹2.4 lakh crore cumulative PLI investment.
Specialty Steel & Electronics
Along with large-scale electronics manufacturing, rounds out the top 5 concentrated sectors.
PLI has worked well for specific sectors, but the broader manufacturing base hasn’t seen proportional or widespread benefits — a sector-concentration risk for the scheme’s long-term impact.
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Source: The Hindu
