India is moving into a golden era of industrialization. The manufacturing sector with the increase in domestic consumption, government policy of latest Industry 4.0 technology, and their rapid adoption is becoming one of the biggest contributors to economic growth. The next decade is an ideal opportunity that should be grasped by entrepreneurs, investors, and existing businesses to establish profitable ventures.
In this blog, we will identify the most profitable businesses in India manufacturing sector likely to be profitable in the next decade and why they are important to long-term growth.
- Electric Vehicles (EVs) and Battery Manufacturing
Its future transport is electric. India has already promised to bring its EV penetration to 30 per cent by 2030 and global automakers are already spending huge on the local production. However, there is Veritable profitability in two domains:
- Production of EV components- batteries, motors, controllers and charging equipment.
- Reuse and recycling of batteries – reduction of imported dependence and a circular economy.
As state and federal governments subsidize EV manufacturing as well as people using EVs, manufacturing these cars will not only generate employment opportunities but also generate some of the best returns within the same decade.
- Solar Panels and renewable energy equipment.
In an era where the world is slowly moving away towards fossil fuels, India has an ambitious goal of installing 500 GW renewable energy capacity by 2030. This renders the solar industry a goldmine in terms of manufacturing enterprises.
Opportunities include:
- Solar panel and module manufacturing
- Solar power inverters and battery-systems
- Green hydrogen equipment and wind turbine parts
It is assumed that demand will be created not only by large-scale solar parks but also rooftop solar systems among households and industries.
- Electronics and semiconductor manufacturing.
India is becoming the hub of the electronics industry because of the production-linked incentive scheme implemented by the government. The demand of smartphone, laptops, and smart appliances is on the rise and there is a move by companies relocating supply chains out of China and into India.
Most promising areas of profitability:
- Consumer electronics (mobiles, wearables, smart TVs).
- Semi conductor manufacture assembly.
- Printed circuit boards (PCBs) and sensors of AI and IoT purposes.
In the next decade, India will likely become one of the major producers of the electronics and semiconductors sectors globally.
- Pharmaceutical and Biomanufacturing.
Already, the country is the world pharmacy, exporter of low-cost drugs to other countries across the globe. In the following decade, the industry will transcend generic drugs into biopharmaceuticals, vaccines and nutraceuticals.
High growth opportunities are:
- Chronic illnesses and biologics as well as biosimilars.
- Manufacturing third-party on behalf of international pharmaceutical companies.
- Health, Herbals in line with the Indian Ayurveda heritage.
Both domestic and international demand will ensure that this industry remains highly lucrative due to increasing awareness of healthcare.
- Food Processing and Agri-Tech Manufacturing.
India is the second-biggest maker of fruits, vegetables, and grains, and yet comparatively low food processing is known than in developed countries. Due to the transforming lifestyles and urbanization, the demand of packaged, frozen, and ready-to-eat food will increase dramatically.
- Profitable opportunities are those that manage to sustain the unit in case of profitability.
- Dairy, seafood, snack and beverage food processing facilities.
- Cold chain equipment manufacturers and Agri-machinery and drone manufacturing to aid in precision farming.
The industry has both good domestic demand and promising export opportunities.
- Green construction Materials.
The real estate and infrastructural sectors are replaceable to expand faster but sustainability will be the catch word. The production of environment-friendly building materials like a recycled cement, fly ash bricks, and smart glass will become even more popular.
Opportunities:
- Prefabricated housewares.
- Super efficient insulating materials.
- Green-based coatings.
Green certifications are becoming the priority of builders and the governments thus creating a large demand.
- Textile and Technical fabrics
Technical textiles and sustainable fashion manufacturing is the future of the next decade in India, as it has already been doing well in the textile business.
- Trunks with profitability drivers
- Medical textile such as PPE kits and surgical fabrics.
- Car driving and building industrial fabrics.
- Ethical fibers such as Lord of the nettle and organic cotton.
It is a good business idea to be an export-oriented manufacturing business since there is an increased global demand in sustainability in fashion.
- Sustainable Plastics and Packaging Materials.
As the e-commerce and food delivery business and FMCG expand, so does the growth in demand of the packaging solutions. However, the future prospects of traditional plastics are under regulatory bans, and therefore in the future the way forward is the use of eco-friendly and recyclable packaging.
Opportunities that are viable to make profits are:
- Plastics that are biodegradable such as corn, sugarcane or bamboo plastics.
- Paper and Molded fiber packaging.
- Pharmaceuticals/Food high-performance packaging film.
With sustainability entering into the realm of necessity, the industry will be reliable in terms of profit and export potential.
- Aerospace and Defense Manufacturing.
India spends heavily on defence and the government aims at making the country self-reliant under its new initiative, Atmanirbhar Bharat, by producing arms internally. They have opened the door to the partnership of defence equipment with private enterprises.
Places of interest:
- Drones and unmanned vehicles.
- Airplane part and overhaul items.
- Naval shipbuilding materials.
As the concern of self-reliance is gaining more and more geopolitical emphasis, this sector will keep on being invested heavily and will remain long-term profitable.
- Manufacturing of healthcare devices, and making of medical equipment.
The country mostly relies on imports to supply a significant portion of its medical devices, but in the coming decade the increase in local manufacturing will be a huge push. The industry is poised to record a massive growth with the increasing healthcare demands, medical tourism and government incentives.
Opportunities include:
- Diagnostic devices (Portable, MRI, CT).
- Internet of Things provides power to wearable health monitoring devices
- Surgical instruments.
Why These Businesses Will Dominate the Next Decade.
Government support: PLI schemes, tax incentives and infrastructure development.
Technological Change: There will also be an improvement of efficiency and margins, as a result of embracing AI, robotics, and automation.
Global supply chain shift: Most of the countries are decentralizing the manufacturing away to China.
Increasing domestic demand: India is a stable market as the consumption of the middle rank is rising.
Final Thoughts
The manufacturing industry in India reaches an infliction point. Companies that are sustainability oriented, technologically oriented firms and those enabling self-reliance will be most profitable in the next decade. Now is the time to enter these sectors whether you are an entrepreneur or investor.
Electric vehicles, pharmaceuticals and renewable energy are just some of the opportunities that are enormous and growing. The right strategy and India can become the promise of the most lucrative manufacturing revolution of the next ten years.