India’s aspiration to become a global manufacturing powerhouse faces a significant challenge, with a $5.1 trillion investment gap threatening progress toward its long-term goals, according to NITI Aayog. The shortfall highlights the scale of capital, infrastructure, and ecosystem reforms required for India to raise manufacturing’s share in GDP and compete with global peers.

Manufacturing is central to India’s vision of becoming a $10 trillion economy, generating large-scale employment, boosting exports, and strengthening supply-chain resilience. However, NITI Aayog notes that current investment levels fall well short of what is needed to expand capacity, modernise factories, adopt advanced technologies, and build globally competitive industrial clusters.

The gap spans multiple areas—physical infrastructure, logistics, industrial land, energy availability, skilling, and technology adoption. While initiatives such as Make in India, Production-Linked Incentive (PLI) schemes, National Logistics Policy, and industrial corridor projects have improved momentum, execution challenges and private-sector risk aversion continue to slow progress.

Experts point out that closing the gap will require greater private investment, deeper financial markets, faster clearances, regulatory stability, and stronger state-level participation. Technology-led manufacturing—leveraging automation, AI, digital twins, and clean energy—will also be critical to improve productivity and cost competitiveness.

NITI Aayog emphasizes that bridging the $5.1 trillion gap is not just about funding, but about systemic reforms and coordinated action. Without this, India risks missing a historic opportunity to reposition itself as a global manufacturing hub.