The need to decouple Atmanirbhar Bharat and Viksit Bharat

India today is, unmistakably, a services-driven economy. As per the Economic Survey and recent government releases, the services sector (tertiary) now contributes around 55% of Gross Value Added (GVA) in India. The sector also accounts for roughly 30% of India's workforce as per ILO and World Bank estimates. In short, India's growth engine is powered by services, not agriculture or low-end manufacturing.

- LAKSHIT MITTAL

Yet over the decades, India has long aspired to emulate the manufacturing-led growth path of others, most notably China. Be it through import substitution in earlier decades, the “Make in India” push since 2014, or the more recent Production Linked Incentive (PLI) schemes, successive governments have sought to build a strong domestic manufacturing base.

In the past decade, especially, this thrust toward manufacturing has been reinforced by shifting geopolitical winds. The COVID-19 pandemic exposed fragilities in global supply chains. Overreliance on dominant economies, be it China for inputs, or the U.S. for markets, proved a risky bet. The emergence of inward-looking policies abroad (e.g. “America First”, trade wars, sanctions) eroded trust in global interdependence. Many nations responded by pivoting inward, emphasizing strategic autonomy and self-reliance.

For India's 1.4 billion population with 65% working age population and it's $4 trillion economy growing at a steady rate of ~6-7 %, this inward turn is a natural inclination. The resurgence of “swadeshi” sentiment, the push to galvanize MSMEs (micro, small and medium enterprises) into manufacturing, and campaigns encouraging citizens to preferentially consume Indian goods, all epitomize this shift. In that sense, the idea of Atmanirbhar Bharat is appealing: local resilience in the face of global volatility.

Indeed, crafting buffers against external shocks, ensuring supply chain security, and developing critical capacities (e.g. in pharmaceuticals, electronics, defence) are legitimate strategic imperatives. Atmanirbhar Bharat is an essential cushion. It is about safeguarding sovereignty and building robustness in a world of flux.