Towards 2025: India's Industrial Sector

Introduction

India is leading the world in the transition to industrial innovation and sustainability, and it is making great strides toward ambitious goals that will change the country's economic structure by 2025. With an installed capacity of more than 100 GW by 2021, the country's renewable energy industry is a shining example of success, ranking India among the top five nations in the world for renewable energy capacity. The government's ambitious plans, which reflect an unmatched dedication to moving towards a low-carbon economy, aim for 175 GW by 2022, with an even higher target of 450 GW by 2030.

Concurrently, the manufacturing industry, which accounts for 15% of India's GDP, is about to undergo a revolutionary change. The country hopes to raise this percentage to 25% by 2025 with the strategic "Make in India" drive, adding 100 million new employment. In addition to improving manufacturing skills, this project aims to draw significant foreign direct investment (FDI), which has increased significantly, with over $70 billion going into India's manufacturing sector since the program's inception in 2014.

Significant investments, legislation changes, and technological breakthroughs support both the growth story in manufacturing and renewable energy. India's path to 2025 is more than simply an economic undertaking; it is a paradigm change towards sustainable development that integrates environmental care and economic prosperity. To support manufacturing, India plans to spend $1.4 trillion on infrastructure between 2019 and 2023. With over $42 billion invested in the renewable energy sector between 2014 and 2020, the country lays the foundation for a prosperous and resilient economic model.

The statistics and goals that lie ahead tell a fascinating tale about India's strategic orientation and potential influence on the international scene when we dig further into the details of these industries. This introduction lays the groundwork for thoroughly examining the developments, difficulties, and prospects in India's manufacturing and renewable energy sectors as the country boldly moves toward a greener and more industrially robust 2025.

Current Scenario

With an installed capacity of 100 GW by the end of 2021, India's renewable energy sector has established itself as a worldwide leader, placing the nation fourth in the world for wind power and fifth for solar power. The industry has attracted over $64 billion in investments since 2014, fueled by significant investments and supportive legislation allowing this quick rise. The two main drivers of this expansion are wind energy, which contributes around 38 GW, and solar energy, which has an installed capacity of about 40 GW. The government's aim for a clean energy future is emphasized by its commitment to raising renewable capacity to 175 GW by 2022 and establishing an ambitious target of 450 GW by 2030.

Regarding manufacturing, India's plan to use this industry to drive economic growth is demonstrated by the sector's 15% GDP contribution, which it hopes to reach 25% of the GDP by 2025. Foreign direct investment (FDI) was attracted by the 'Make in India' campaign and the Production Linked Incentive (PLI) plan, which grew by 76% to $81.97 billion in the fiscal year 2021–2022. This investment boom is evidence of the increasing trust that the Indian economy can produce quality goods, particularly in high-demand sectors like electronics, drugs, textiles, and auto components. By distributing $26 billion to 14 industries under the PLI plan, the government hopes to boost home production, lower import costs, and increase the competitiveness of Indian manufacturing abroad.

To maintain this growing pace, both sectors must overcome their own obstacles, including the demand for trained personnel, regulatory obstacles, and infrastructural development. To achieve its ambitions for 2025 and realize the full potential of its manufacturing and renewable energy sectors, India must adequately address these problems.

Growth: Promoters and Challenges

The landscape of India's renewable energy and manufacturing sectors is shaped by strategic government policies, technological innovations, and market dynamics, even as it navigates through various challenges.

Growth Drivers:

• Policy Initiatives: A cornerstone of India's drive towards renewable energy is the recent Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) Yojana, aimed at supporting the installation of solar pumps and grid-connected solar and other renewable power plants across the country. This initiative, alongside the PLI scheme that allocates $26 billion to stimulate domestic production in sectors including renewable energy components, will significantly accelerate India's transition to clean energy. The National Solar Mission's targets, which are integral to achieving a capacity of 450 GW by 2030, further underscore the government's commitment.
  

• Technological Innovation and Investment: The sector's growth is buoyed by advancements in solar technology, improvements in battery storage, and smart manufacturing processes, complemented by a steady flow of investments. With over $64 billion invested in renewable energy since 2014 and record FDI inflows into manufacturing, the momentum for growth is strong.

Challenges:

• Infrastructure and Supply Chain Gaps: Despite these initiatives, the renewable sector faces challenges in grid integration, storage capacity, and supply chain logistics, which are critical for deploying solar technologies at scale. While bolstered by policy incentives, the manufacturing sector must overcome infrastructural bottlenecks and dependencies on imports for crucial components.

• Skill Development: The advancement of renewable technologies and the shift towards high-tech manufacturing necessitate a workforce skilled in emerging technologies. Bridging this skill gap, particularly in the solar energy sector, is vital for sustaining growth and innovation.

• Regulatory Environment: Streamlining regulatory procedures for land acquisition, environmental clearances, and inter-state energy transmission remains a hurdle for the rapid expansion of solar energy projects. For manufacturing, aligning policies across state and central levels to reduce bureaucratic obstacles is crucial.
  

Introducing the PM-KUSUM Yojana and other supportive schemes like the PLI for solar PV manufacturing represents a significant step towards mitigating these challenges. Promoting decentralized solar energy production and incentivizing domestic manufacturing of solar PV modules aims to enhance India's energy security and position the country as a leader in renewable technologies.

2025 Outlook: An Innovative and Sustainable Economy

India's renewable energy sector is predicted to have an installed capacity of over 200 GW by 2025, a significant step towards the 450 GW target set for 2030. India's growth trajectory places it at the forefront of the global renewable energy sector, substantially contributing to the international objectives for reducing emissions. By 2025, it is projected that the manufacturing industry will have grown to a $1 trillion market thanks to export-led development and high-value manufacturing. The introduction of Industry 4.0 technology, which has propelled India into the ranks of top industrial economies, indicates this sector's progress.

The expansion of these sectors is set to revolutionize the job market:

• Renewable Energy: The industry is expected to generate over 1 million jobs by 2025, with roles in project management, engineering, and R&D. The average salary for solar engineers and wind energy technicians ranges from $7,000 to $10,000 per annum, reflecting the growing demand for skilled professionals in renewable energy technologies.

• Manufacturing: With the sector's emphasis on high-value and sustainable manufacturing, over 3 million new jobs are projected, particularly in robotics, sustainable product design, and supply chain management. The average salary in advanced manufacturing roles is expected to be between $8,000 and $12,000 annually, varying by specialization and experience.

• Cross-Sector Opportunities: The convergence of these sectors creates new roles in sustainability consulting, environmental science, and green technology innovation, with competitive salaries reflecting the specialized skill sets required.