Author: Nishtha Mehrotra | EQMint

India is entering a new phase of industrial expansion, with technology, manufacturing and infrastructure emerging as key drivers of growth. A recent report by global investment bank Jefferies identifies six sectors — space, semiconductors, data centres, electronics, solar manufacturing and aerospace — that could play a major role in India’s next industrial cycle.

The report points to India’s large domestic market, rising private-sector participation and government incentives as key factors supporting this expansion. The shift is also moving beyond assembly and services towards greater domestic manufacturing and higher-value technology capabilities.

1. India’s Space Economy Could Reach $40–45 Billion

India’s space sector is expanding beyond government-led programmes, with private companies increasingly participating in launch vehicles, satellites and space-based applications.

According to Jefferies, India’s space economy could grow around fivefold to $40–45 billion by 2030. Companies including Skyroot Aerospace, Pixxel and Agnikul are among the private players developing commercial space technologies.

The expansion of private participation is creating opportunities across launch services, satellite manufacturing, Earth observation and other space-related technologies.

2. Semiconductor Manufacturing Gains Momentum

India’s semiconductor push is moving from policy announcements towards manufacturing and project execution.

Jefferies estimates that around $20 billion has already been invested in India’s semiconductor sector, while additional government incentives are expected to support the development of fabrication, packaging and testing capabilities.

The development of a domestic semiconductor ecosystem could also support India’s broader electronics manufacturing ambitions by reducing dependence on imported components over time.

3. Data Centres Set for Major Expansion

India’s rapidly growing digital economy and increasing artificial intelligence demand are driving significant investments in data-centre infrastructure.

Jefferies expects India’s data-centre capacity to rise from around 2 GW to 10 GW over the next five years. The report estimates a potential opportunity of approximately $45 billion across areas such as power, cooling, construction and networking.

The expansion reflects the increasing infrastructure requirements associated with cloud computing, AI and digital services.

4. Electronics Manufacturing Moves Towards Localisation

India’s electronics industry is also shifting from simple assembly towards greater domestic component manufacturing.

Jefferies estimates that domestic value addition in mobile components is currently below 20% and could rise to around 50% over the next six years as localisation efforts expand.

The shift could allow Indian manufacturers to capture a larger share of the value generated across the electronics supply chain rather than primarily focusing on final assembly.

5. Solar Manufacturing Expands

Solar manufacturing is another major area highlighted in the Jefferies report.

India is already among the world’s largest solar photovoltaic manufacturing markets. The report notes that around 35 GW of solar-cell capacity is operational, while another 100 GW is under construction.

Jefferies expects approximately 90% of the solar manufacturing value chain to be localised by 2030, reflecting the country’s push to build domestic capacity across the sector.

6. Aerospace Supply Chains Create New Opportunities

India’s aerospace manufacturing ecosystem is also becoming increasingly integrated with global supply chains.

According to the report cited by NDTV, Boeing and Airbus procure around $1.4–1.6 billion worth of components from India annually. Indian companies are supplying parts to major global aerospace manufacturers and Tier-1 suppliers.

India’s engineering capabilities and manufacturing costs are among the factors supporting its growing role in the aerospace supply chain.

Government Support and Private Investment

Jefferies attributes India’s industrial expansion to a combination of domestic demand, private investment and government policy support.

In sectors such as semiconductors, electronics, solar manufacturing and space, government incentives and localisation measures are being used to encourage companies to build production capabilities within India.

The combination of policy support and private-sector participation is creating a broader industrial ecosystem spanning advanced manufacturing, infrastructure and technology.

India’s Shift Towards High-Value Manufacturing

The six sectors identified by Jefferies represent a broader change in India’s industrial strategy. Rather than relying primarily on imports or basic assembly, the country is attempting to build capabilities across more stages of the technology and manufacturing value chain.

Space, semiconductors, data centres, electronics, solar and aerospace also have links with other industries, including power, engineering, construction, logistics and digital infrastructure.

The expansion of these sectors could therefore have implications beyond the companies directly involved in manufacturing or technology.

The Road Ahead

India’s industrial expansion is still developing, and the pace of execution will depend on investment, infrastructure, technology development, skilled manpower and policy implementation.

Jefferies’ report highlights the scale of the opportunity across six emerging sectors, while the actual development of these industries will depend on how effectively companies and policymakers convert planned investments into operational capacity.

With growing private participation and continued investment in technology and manufacturing, India is building a broader industrial ecosystem that extends from chips and solar cells to satellites, data centres and aircraft components.

Disclaimer: This article is for information purposes only and is not investment advice.

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