New Delhi, March 2
India's experience demonstrates that import substitution and export strength can move together when approached strategically. Across sectors, from mobile phones and medicines to automobiles and defence, the push is to build in India not only for domestic needs, but for global markets as well, according to an official factsheet issued on Monday.
As local capacity expands and imports reliance falls, many industries also gain the scale to export more, strengthening the external sector.
Despite the global economic uncertainties, India's cumulative exports reached $720.76 billion in April-January 2025-26, which represents a 6.15 per cent year-on-year growth. The high growth was driven by the government's focus on sector-specific incentives, investments, and reforms in scaling domestic manufacturing capabilities. Over the past decade, bold reforms and visionary policies like 'Make in India' initiative and 'Production-Linked Initiatives' have transformed the country into a global manufacturing hub, the official statement said.
A direct outcome of the import substitution efforts is clearly visible in the striking performance of India's electronics manufacturing. With a target of building a $500 billion domestic electronics ecosystem by 2030-31, India is now firmly on track to become a global leader in electronic design, manufacturing and exports.
Electronics production in India rose from Rs 1.9 lakh crore in 2014-15 to Rs 11.3 lakh crore in 2024-25, nearly a six-fold increase. The country has attracted over $4 billion in FDI in electronics manufacturing since 2020-21, reflecting rising global investor confidence. The electronics manufacturing sector has generated around 25 lakh jobs in India over the last 10 years.
India is now the world's second-largest mobile phone manufacturer, with more than 300 manufacturing units operating today compared to just two units in 2014.
Production in the mobile manufacturing segment has increased from Rs 18,000 crore in 2014-15 to Rs 5.45 lakh crore in 2024-25, a 28-fold rise.
A similar thrust is visible in other high-value sectors. Semiconductors and electronics components are critical areas where import substitution is strategically important, as seen during global chip shortages. Acknowledging this, Budget 2026-27 announced the launch of India Semiconductor Mission 2.0 to produce equipment and materials, design full stack Indian IP, and fortify supply chains, alongside expanding the Electronics Components Manufacturing Scheme (with an increased outlay of Rs 40,000 crore).
Strong institutional reforms like the Export Promotion Mission (EPM) which enhances trade finance, logistics, compliance, and market access also provided a strong boost to exports. Looking ahead, the Union Budget 2026-27 focuses on scaling strategic manufacturing, thereby strengthening export competitiveness, the statement observed.
The global trade landscape has been undergoing adjustments as reflected in UNCTAD Trade Policy Uncertainty (TPU) Index and the Global Economic Policy Uncertainty (GEPU) Index in April 2025. At the same time, these developments have accelerated India's efforts to strengthen resilient supply chains, expand diversified trade and investment partnerships worldwide.
Against this backdrop, India has been able to pursue targeted import substitution in critical sectors, pairing it with an export-oriented approach to stay competitive over the long run.
- IANS
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