Leap from cost competitiveness to innovation-led manufacturing

India can turn its low-cost production base into a technology-driven industrial force of high value

- SUNJAY J. KAPUR

India is currently on a decisive path to establishing itself as a global manufacturing powerhouse. Moving beyond cost competitiveness, the country is evolving into an innovation-driven industrial hub. The foundation for this transformation is being laid through technology advancements, a fast-maturing startup ecosystem and strategic policy interventions, as highlighted in the budget for 2025-26.

With global supply chains shifting and industries transitioning to smarter and more sustainable methods of production, India has an opportunity to move from the traditional 'build to print' model to attaining leadership with 'build to design' at its core.

Modern manufacturing focuses more on intelligence than mere scale. The transition underway from labour-intensive assembly lines to connected, automated and AI-driven factories marks the dawn of a new industrial era. India's push for Industry 4.0 (and in some cases 5.0), supported by progressive policy measures, is enabling enterprises to integrate automation, Internet of Things (IoT) and data analytics into production systems.

The government's focus on semiconductor making, deep-tech research and development (R&D) and electronics has already begun to attract major investments. Targeted schemes for critical materials such as lithium, with a focus on high-value tech applications, will also be crucial in reducing India's import dependency and positioning the country as a key player in global supply chains.