India’s improved competitiveness in global manufacturing is fuelled by strategic policy reforms, infrastructure upgrades, and demographic strength, according to S&P Global, which sees the country building a more self-reliant and resilient industrial framework
India’s manufacturing sector is drawing increased global attention as a competitive and investment-friendly destination, according to a new report from S&P Global titled, “India Forward: Transformative Perspectives.” The report outlines how the country is capitalising on global economic shifts, advancing clean energy initiatives, and enhancing its policy frameworks to support industrial and economic growth.
S&P Global underscores that India’s strategic reforms, demographic strength, and infrastructure development are boosting its global manufacturing appeal. The country has made significant strides in improving its competitiveness, supported by targeted policies aimed at creating a self-reliant and resilient industrial base.
India’s clean energy push
One of the report’s key highlights is India’s intensified push for alternative energy, especially biofuels, as a core part of its long-term transport and energy strategy. This clean energy focus delivers a “triple win” — strengthening energy security, reducing emissions, and boosting rural incomes. S&P says these efforts are critical to building a greener and more self-reliant economy.
India is also expected to benefit from shifting global trade alignments. With its economy projected to become the world’s third-largest by FY31, India’s manufacturing, agriculture, and services sectors are set to witness sustained demand growth. These sectors have expanded in tandem with structural changes and demographic trends, creating a solid foundation for long-term progress.
Manufacturing growth and challenges
India’s improved manufacturing outlook is supported by the Strategic Opportunity Index (SOI) developed by S&P Global Market Intelligence. The index indicates that India has made notable gains in competitiveness, particularly in attracting foreign investment. The HSBC India Manufacturing Purchasing Managers’ Index (PMI), compiled by S&P Global, rose to 58.2 in April 2025 — the fastest pace of expansion in 10 months — reflecting strong order flows and rising production.
However, the report flags ongoing challenges. India’s score in resource availability, which measures access to labour and finance, stands at 69.4 out of 100. A major bottleneck remains the availability of skilled labour, which scored only 50 out of 100. While skilling programs are underway — particularly in high-tech areas such as semiconductors and solar energy — they are yet to fully bridge the existing talent gap.
India’s strategic energy outlook
Energy security is another major theme in the report. S&P notes that India's integrated energy strategy — encompassing fossil fuels, renewables, and nuclear — is increasingly aligned with global market needs. Recent developments, including the Oilfields (Regulation and Development) Amendment Bill, 2024, are designed to revive exploration activity and boost domestic production amid rising global uncertainty.
With global oil and gas exploration slowing, India is emerging as an attractive alternative growth market for international energy players. S&P Commodity Insights highlights the expected expansion of India’s gas sector, even as liquid fuel production trends downward.
As the global energy narrative shifts, India’s diversified approach to energy — described as an “all-of-the-above” strategy — positions it well for future resilience. The report concludes that how India prepares for global supply chain disruptions and strengthens its domestic infrastructure will determine the sustainability of its growth trajectory.
In essence, India is no longer just an emerging player — it is becoming a pivotal hub in the global manufacturing and energy landscape.
