India's Ascending Horizons: Powerhouses Driving Expansion and Vitality

As India's economic narrative continues to unfold with remarkable vigor, its portion of the worldwide GDP has escalated from a mere 1.9% in 2008 to 3.4% by 2023. The nation's leadership has set an audacious target: claiming 8 to 10% of global GDP by 2040. This ambition demands more than gradual advancements; it calls for bold strides in vibrant domains ripe for substantial expansion and energy - what experts term as "powerhouses" of competition.

India's commercial terrain, much like the nation itself, is in perpetual flux. Numerous enterprises stand ready to cultivate and leverage their strengths amid this lively era. Through examining sectors poised for remarkable expansion, tech breakthroughs, and consistent funding flows, we've pinpointed 18 transformative domains. Half of these are international powerhouses, where Indian entities could secure outsized gains via uniquely local proficiencies. The remaining half are domestic powerhouses, tailored to propel enduring national objectives and growth in a distinctly Indian framework. This blend of worldwide and homegrown powerhouses could be instrumental in fulfilling India's aspiration to emerge as an advanced economy by 2047.

Realizing the potential in these powerhouses will necessitate inter-industry partnerships, resolute moves by Indian firms, and enabling regulations. This piece delves into these 18 powerhouses for India, dissects the prospects within each, and suggests pathways for Indian enterprises to seize value.

The Powerhouses Shaping India's Trajectory

Though Indian businesses had a somewhat marginal influence in molding global powerhouses from 2005 to 2020, they are primed to make substantial contributions to forthcoming ones. An exhaustive review of swiftly advancing major sectors, alongside India's intrinsic assets, competencies, and key priorities, has revealed 18 powerhouses capable of yielding $1.7 trillion to $2 trillion in earnings for India by 2030, a leap from $690 billion in 2023. These could secure about 30% of the added GDP by 2040.

The McKinsey Global Institute outlines a powerhouse as a distinct grouping of sectors marked by elevated growth and vitality. In 2024, it highlighted 12 such powerhouses that had doubled their earnings proportion and tripled their valuation from 2005 to 2020, reshaping commerce. Drawing from these traits, it suggested 18 future powerhouses set to redefine the global economy over the next decade or so (like online shopping, data hosting, automation tech, and shared self-driving transport), amassing up to $48 trillion in earnings and $6 trillion in gains. Indian companies, with limited involvement in past powerhouses, can now take center stage in chosen global and domestic ones.

Eighteen powerhouses could deliver $1.7 trillion to $2 trillion in earnings for India by 2030.

Total earnings from global and domestic powerhouses: ~$690B in 2023; ~$1.7T–$2.0T estimated by 2030.

Powerhouses could secure roughly 30% of India's added GDP by 2040 to aid its goal of becoming an advanced economy by 2047.

Projected GDP, India ($T):

Catalyzing the Shift from Industries to Powerhouses

What elevates an industry to a powerhouse? The catalyst arises from three elements: quantum leaps in tech or operational models, persistent high funding trends, and nurturing a vast, expanding target market.

Major innovations forge fresh efficiency trajectories in an industry, spurring tech or operational quantum leaps, often signaled by heightened patent filings or R&D commitments. We pinpointed industries where patent filings surpassed twice the midpoint or R&D outlays exceeded the countrywide norm by twofold.

Tech Quantum Leap: Prospective powerhouses display notable patent activity, signaling innovation promise.

Number of patents per $B revenue:

Ratio of weighted average for prospects vs others: 14× (~2× midpoint patent tally).

Tech Quantum Leap: Prospective powerhouses attract outsized R&D funding in India.

R&D as % of revenue:

Ratio for prospects vs others: ~5.5× (~2× national norm).

Persistent elevated investments in industries amplify production and refine output processes. To spot funding drive, we sought indicators of financier trust like ongoing private equity/venture inflows over $1B or >15% annual growth. We also monitored public commitments, where state capital in infrastructure or innovation hinted at bets on the industry's future. Lastly, we observed actions of India's major groups, assuming their hefty, enduring investments signal conviction in the industry's evolution.

Rising Investments: Prospective powerhouses saw substantial funding, signaling perceived high expansion promise.

Private equity/VC scan: Average invested capital 2022-24 ($B) vs CAGR 2020-24 (%)

Rising Investments: Prospective powerhouses receive notable backing from state budgets.

Annual sector budget vs growth rate: Allocated budget 2025 ($B) vs CAGR FY2023-25 (%)

Expanding industries where need eclipses the broader economy could be unleashed via tech/operational leaps and steady high investments. These might supplant portions of current large markets with superior alternatives. We targeted industries with scales >$3B and >12% annual growth, marking their present significance and future promise.

Large Expanding Market: Prospective powerhouses surface with magnitude and strong future expansion potential.

Market size 2023 ($B) vs CAGR 2023-30 (%)

Eighteen industries aligned with the three powerhouse catalysts, emerging as drivers of expansion and vitality. These stand as our 18 powerhouses poised to forge superior economic advancement for India.

The Four Categories of Prospects for India

These 18 powerhouses could mold and hasten India's path to worldwide economic prominence. Each powerhouse embodies a specific strategic stance for India, based on the depth of India's competencies and the market emphasis on either solely India or wider international arenas. This stance defines the essence or broad category of the prospect ahead:

The 18 prospective powerhouses for India offer four categories of prospects.

Prospects to Establish for Home Market

In sectors with somewhat emerging competency, four powerhouses offer chances for a mostly India-for-India market emphasis: chip production, factory electronics, automation devices, and advanced power gen.

Chip Production

Today, India's chip sector centers mainly on design. The nation hosts about 20% of the global chip design talent and serves as R&D bases for leading entities. In the last year, multiple large initiatives, valued from $3B to $11B, have been unveiled, indicating a push toward external chip assembly and testing (OSAT) and older-node manufacturing. These are supported by around $10B in state incentives, anticipated to cut the nation's dependence on imported semiconductors by $10B to $20B.

India's prowess in chip design draws from a vast talent reservoir and an expanding startup scene, ranking the country among the top three worldwide design centers. Yet, the move to extensive chip manufacturing is projected to unfold gradually. India's chip sector aims to reach manufacturing at nodes over 14 nanometers by 2030; advancing to below-ten-nanometer tech will probably require more time. Key hurdles include steep capital needs, restricted access to cutting-edge production tech, and deficiencies in the local supply network, particularly for ultra-pure gases, specialized compounds, and high-purity water. Alliances with top global chip firms could spur and speed up this sector's progress.

As electronics demand in India expands at 2.5 times the global norm, circuit boards (PCBs) surface as a related expansion chance. PCBs demand less funding, around $200M to $250M per facility, versus $5B to $10B for advanced plants, and market entry is quicker. To harness this potential and lessen import reliance, India will need a combination of focused state incentives and collaborations with international tech frontrunners.

Automation Devices

India is advancing swiftly in the automation realm, the upcoming stage of production propelled by information, links, insights, automation, and human-machine synergy. With the seventh-largest count of automation installations worldwide, India stands eighth in automation per million dollars of production GDP. This stems from areas like vehicles, chemicals, drugs, and chips undergoing extensive automation in production areas, storage, and distribution chains.

A emphasis on enhancing worker output and private funding in state-of-the-art setups is projected to double industrial mechanization in India over the coming five years. The state is bolstering this expansion by creating five advanced Smart Advanced Production and Swift Change Hubs (SAMARTH) to educate people and groups.

India is set to expand mechanization across the value network, from conception and programming to system merging, supported by progress in data hosting and edge processing, virtual replicas, additive production, digital protection, and connected devices (IoT). International entities are expected to lead in equipment, while India's strength will probably reside in programming and system merging. Complete solutions for existing projects, delivering affordable mechanization via used markets, will be a key strategy for system mergers in India across bundling, assembly, joining, etc. The pattern is already forming, with homegrown IT companies and nimble startups providing budget-friendly, customized solutions that align with regional requirements.

Advanced Power Gen

India presently boasts around eight gigawatts (GW) of installed atomic capacity, with another seven GW in progress. The state intends to expand civil atomic power to 100 GW by 2047, crucial for meeting India's zero-emission goal by 2070. To broaden atomic energy rollout, the state seeks to expand rapid breeder units (FBRs) and construct compact modular units (SMRs) by promoting private involvement.

While most atomic facilities have depended on pressurized dense water units (PHWRs) and light water units (LWRs), the upcoming wave of FBRs and SMRs marks a tech quantum leap. FBRs could serve as a pathway to India's energy independence aims, as they produce more fuel than they use. SMRs are engineered to be more secure than conventional large units, and they are more economical to construct, utilizing pre-made parts and uniform designs. As private entities join the arena in India and the worldwide market for atomic tech grows, efficiency gains from experience could assist in lowering capital expenses for atomic units.

Factory Electronics

The area is growing in significance within India's economic framework as it encompasses conceiving, creating, and utilizing electronic tools and setups that energize industrial activities. This powerhouse can bolster the nation's transition toward industrial mechanization, sophisticated production, and a sturdier digital foundation.

A spectrum of tech drives this domain, including power tech, DC/AC transformers, material management setups, and industrial automation. Collectively, these represent about 12% of India's overall home electronics output, valued at $101B.

Power tech constitutes a major segment of this market, comprising roughly one-third of the area's value. Its expansion is propelled by the worldwide move to sustainable energy and the surge in EV production, coupled with increased adoption of consumer tech. In India, the power tech market mostly comprises a handful of small, local entities with restricted output capabilities. As a result, reliance on imports, particularly from China, poses a vital challenge; for instance, over 90% of India's string transformers are imported.

In this scenario, various Indian firms have forged alliances with international entities to introduce advanced tech to the home market. Additional acceleration could stem from state-supported efforts like local creation of silicon sheets, establishment of Special Production Areas and small-business clusters for power tech (similar to setups in China and Vietnam), and directed initiatives to draw foreign investment and joint endeavors with worldwide leaders. Fresh income sources may also arise from usage-based models around communal testing setups and nationwide storage grids, aiding the growth of the wider ecosystem.

Looking ahead, patterns like innovative materials and downsizing are anticipated to fuel demand for compact, more effective, and superior-performance tools. Novel materials like gallium nitride (GaN) and silicon carbide (SiC) are beginning to revolutionize power tech, providing superior efficiency, quicker switching, and the capacity to function at elevated temperatures and voltages than conventional silicon. There is also a budding chance to reengineer passive elements to align with the higher switching rates facilitated by these materials.

Prospects to Chase Rapid Expansion

Where competency is comparatively robust and the market emphasis is chiefly "India for India," the prospective powerhouses encompass green energy backup systems, online retail, data hosting, hospitality and leisure, and city development.

Green Energy Backup Systems

India's sustainable energy area is stepping into a rapid-expansion phase, with yearly capacity additions projected to double or triple by 2030, as the nation advances toward its 500 GW objective. This upsurge arises from escalating power needs, declining tech expenses, and a firm policy orientation centered on carbon reduction. Large-scale sustainable projects, mainly facilitated by imported gear, form the biggest value reservoir in the system. Other reservoirs include creation of cells and panels and business and industrial initiatives.

A primary catalyst for this growth is tech innovation. Sustainable energy is now more price-competitive than most traditional power origins, and by 2040, sustainable-plus-backup hybrids are forecasted to be less costly than 60 to 70% of current coal facilities. As sustainables start to form a bigger portion of the energy blend, energy backup will be vital for ensuring round-the-clock supply.

Battery energy backup systems (BESS) are positioned to fulfill about 35% of India's overall backup needs, positioning them as central to the upcoming phase of energy infrastructure. BESS could assume a notable role in backup with frequency management, providing adaptable, precise, and swift responses to continuously offset frequency shifts during standard operations. Hybrid sustainable-backup projects, and mixes of wind and solar initiatives with backup capability are poised to deliver the top returns in the sustainables domain and seize the largest value share as the area progresses.

Online Retail

Online retail in India has skyrocketed in recent years, establishing the nation not merely as a quick adopter but progressively as a pioneer in the domain, as shown by the at-scale emergence of fast-delivery platforms. However, there remains significant room for advancement. Of the nation's 850 million web users, only around 20 to 25% purchase digitally, in sharp contrast to the 85% or higher in developed markets like the US and China. Online retail represents just 7 to 9% of India's overall retail transactions as of FY2023, though this is projected to climb to 15 to 17% by 2030. Operational model changes via emerging formats like fast delivery and social buying are redefining the sector. Fast delivery and social buying comprise over 15% of India's online retail market and are forecasted to surpass 25% by 2030. Online retail entities are generating novel applications by broadening this format to non-traditional categories, providing near-immediate reservations for home services, expert assistance, and health support, etc.

The upcoming surge of online retail growth is anticipated to be driven by two elements: growing reach in fresher segments (e.g., business-to-business and construction materials), and deeper infiltration into secondary and tertiary cities where monthly earnings have been rising. Monthly earnings in secondary cities surpassed metros and primary cities with an 18% rise between 2023 and 2024. The expansion of international online retail is broadening market entry for Indian enterprises. Governments and enterprises are progressively digitizing acquisitions, generating fresh chances for B2B online retail and platforms like the State e-Market (GeM). Efforts like the Open System for Digital Trade (ONDC) are speeding this drive by allowing broader digital entry for vendors and propelling uptake across consumer and business segments. Moreover, companies are funding to construct a multi-channel approach to deliver uniform customer interactions across all interfaces and facilitate comprehensive growth across offline and online avenues.

Online retail is poised to advance beyond sector disruption to redefine the wider retail system, influencing final-delivery logistics (e.g., electric mobility expansion fueled by fast delivery), financial offerings (e.g., increasing need for purchase now, settle later [BNPL] and no-interest monthly payments [EMIs]), food and drinks (e.g., meal delivery apps allowing ten-minute service from quick-eat outlets), and beyond.

Data Hosting

Worldwide, data hosting has become indispensable in today's digital realm, particularly as the foundation for smart systems and offerings. The newest smart models demand considerable processing power, and data infrastructure is crucial for managing this need.

In India, the massive scaling of data hosting is being influenced by the transfer of local workloads to data centers, data-native app creation, and data localization mandates. To bolster this expansion, data center capability in India is growing at 26%, drawing investments projected to hit $5.7B by 2026. Most enterprises remain in the initial phases of their data journey, generating a considerable expansion chance across infrastructure, platforms, and offerings. Transfer services lead the market, and banking, finance, and insurance (BFSI) and health will be the leading sectors shifting from local to data-based solutions.

There is an increasing need for digital-native app creation and innovation-oriented offerings, which are turning more lucrative. Data-powered platforms are also assuming a vital role in sectors like finance tech, direct-to-buyer brands, and retail, bolstering India's digital trade market. These platforms allow features like instant customization, seamless app operation, and constant customer assistance. State spending on constructing private data centers for state entities represents another considerable value reservoir for data offerings. Furthermore, the uptake of smart tech is likely to hasten data growth, as business smart workloads are nearly solely hosted on public data centers.

Hospitality & Leisure

India's hospitality and leisure sector is evolving. Valued at roughly $170B and forecasted to expand at a consistent 12 to 14% annual rate, the sector constitutes about 2% of India's GDP and sustains nearly 12% of total jobs.

Enhanced facilities, improved security, and a more favorable user interaction have contributed to the sector's swift expansion. Overseas visitor arrivals have doubled in the last ten years. Digitization is rendering travel more accessible, while air journeys by an expanding middle group are driving the sector toward more upscale options.

Outbound journey spending is forecasted to hit $89B by 2027, twice the figure from 2019. Inbound leisure is anticipated to generate high-expansion niche chances, including health, adventure, upscale, and cultural leisure. For instance, health leisure expanded by 33% in 2023, assisted by broadening e-health visa availability to visitors from over 160 nations. Rising journey outlays will continue as a potent economic driver, enhancing regional spending, invigorating local business, and unlocking various productivity layers across related sectors.

As the pattern of niche leisure persists in growing, India has the chance to deploy effective tactics to draw attention from primary visitor markets. It could function as a prime location for homegrown and overseas visitors by cultivating chances for high-expenditure travelers, such as nature-based tourism and culturally varied spots.

City Development

Development and property growth play a primary role in India's economy, representing almost 28% of the nation's capital creation. With urbanization accelerating and an projected 600M individuals anticipated to reside in urban areas by 2030, the need for residences and city facilities, such as transit and water oversight systems, is intensifying. Presently, residence rentals comprise about 9% of private spending, and there is a deficit of around 10M budget-friendly homes, highlighting the necessity to scale advancement in the sector. State initiatives have been central in tackling these issues. The Prime Minister Housing Plan–Urban has approved nearly 11.7M residences since 2015, with 8.2M already finished.

As urbanization rises, both budget-friendly and upscale housing categories are witnessing heightened attention. Mid-upscale housing is projected to expand the quickest, responding to increasing incomes. The count of high-wealth and ultra-high-wealth families in India is anticipated to rise from 3% today to about 9% by 2034, elevating need for luxury residences. Some major developers have reacted by doubling their staff in 2024, indicating their confidence in the sector's ongoing expansion and the prospects forward.

Business assets, such as workspaces, shared kitchens, and retail spaces have lower per-person reach in India than in other emerging nations. As urbanization grows, this category could see considerable advancement alongside the growth of city facilities, encompassing public transit networks, wastewater oversight grids, and other akin developments.

Prospects to Forge Worldwide Edge

Powerhouses where India possesses moderately emerging competencies and a mainly global market emphasis include green transport & storage, health tech gear, life science drugs, aviation & security, and bio-innovations.

Green Transport & Storage

India is steadily building a stance as a primary participant in the worldwide EV and storage ecosystem. Over the past five years, EV reach has multiplied ten times, and by 2030, EVs are forecasted to represent about 20% of transactions in the four-wheeler and light business vehicle (LBV) groups, with swifter uptake probable for buses, at 30 to 35%. There is also a drive from manufacturers to launch EVs that align with traditional engine products: EV versions are offered for traditional equivalents in 40 to 50% of the two-wheeler market, over 80% of the three-wheeler market, 40 to 50% of the personal vehicle (PV) market, and 30 to 40% of the business vehicle (BV) market by volume as of FY2024. EVs are also turning more accessible across wider markets with tech progress in storage cells and a roughly 40% decline in lithium-ion storage costs from 2023 to 2030.

Home storage need is positioned to expand about 15 times between 2025 and 2040. This expansion could be driven by the swift uptake of energy backup systems, a emphasis on attaining sustainable energy goals (about 500 gigawatt-hours [GWh] by 2030), and a rise in EV utilization (particularly in the two- and three-wheeler categories that are suitable for city use and demand lower initial expenses). As EV operation enhances to match that of traditional vehicles, and as public knowledge increases, establishing local storage creation becomes progressively vital to decrease dependence on imports. Backed by the Advanced Cell (AC) Production Tied Incentive (PTI) plan, local cell creation is gaining momentum. By 2030, India is projected to possess around 75 GWh of high-likelihood home capability.

With storage creation, a wider localization of the EV storage ecosystem is probable to ensue, from processing of raw resources to creation of parts (such as positives, negatives, dividers, and fluids), stretching all the way to storage repurposing.

With probable worldwide shortages of processed lithium and nickel, India has a chance to pioneer in storage repurposing, which could satisfy 20 to 30% of global need for lithium, nickel, and cobalt by 2050, if collection rates improve. While processing capability may exceed need in the near term, India's cost benefits, supportive rules, and expanding home supply position it strongly to become a worldwide repurposing center over the long haul. Essentials to unlock this promise are reinforcing of extended maker accountability (EMA) and establishing international alliances for sourcing inputs.

Health Tech Gear

India's health tech gear sector is swiftly growing, propelled by escalating health requirements, a vast populace, and heightened awareness among an expanding consuming segment. This market, with a expansion rate of 12 to 15% annual, remains underserved and has additional potential, particularly as more individuals become conscious of health concerns, coverage broadens, and emphasis on preventive and customized care increases. Traditionally, the sector has depended heavily on imports and focused on lower-worth products. That is beginning to shift. There is a evident move toward local creation, accompanied by a increasing focus on exports. Indian firms have also started building a worldwide footprint by creating higher-tier gear, often via alliances and buyouts, vying on both cost and standard.

India is surfacing as an appealing site for R&D with its robust stream of design talent - over 40,000 biotech alumni yearly. International firms are progressively establishing R&D hubs in India to aid product creation and verification.

Life Science Drugs

India holds a well-established standing as the "drugstore of the globe," providing about 20% of worldwide generic remedies and 60% of immunizations by volume. While the nation's core strength stays in high-quantity, cost-effective formulations creation, it is gradually ascending the value ladder. India is projected to assume a considerably larger role in the global drug supply network, driven by its strong foundation of Worldwide Capability Hubs (WCHs), an growing Contract Creation and Development Entity (CCDE) system, and increasing specialization across R&D offerings. India hosts over 3,500 biotech ventures and 12 biotech hubs, and its innovation stream has expanded 1.5 times in the past decade, signaling rising drive and promise for enhanced worldwide significance post-2030. With life science drugs comprising only 15 to 20% of drug earnings in India (well under the global norm of 50%), there is plenty of room for advancement.

On the public-wellness side, India is confronting a surge in overweight rates, with about 6% (or 60M) of the population deemed overweight. This pattern is adding to a increasing load of lifestyle diseases like sugar imbalance and heart issues. By 2030, around 9% of India's population could be deemed overweight, rendering the nation host to the world's third-highest count of overweight people. The newest wave of overweight remedies, which function by aiming biological routes to curb hunger and enhance sugar control, are projected to upend the anti-overweight market. While multinational entities have launched these treatments in India at markedly lower price levels (around $200 monthly versus over $1,000 in the US), creation scale remains an issue, and China maintains a relative edge in active drug component (ADP) quantities. Over the extended term, wider market involvement and heightened rivalry may enhance affordability and availability for Indian patients.

Aviation & Security

India's security sector has witnessed a evident shift toward local creation since the launch of the Security Purchase Process (SPP) in 2020. A reduction in import reliance from 65% in 2019–20 to 35% in 2024–25 mirrors a stronger emphasis on localizing security creation competencies. Private firms are now assuming a larger role, particularly in creating essential modules and subsystems. This developing alliance broadens the private sector's presence and prepares the ground for its deeper merging across the security value network.

The market is forecasted to hit $40B to $50B by 2030 on the strength of increasing home and export need. This indicates a major step for India toward autonomy and worldwide rivalry. Exports are projected to expand by 16% yearly, reaching $6B by 2029–30, with robust drive in ground and aerial systems.

The sector's expansion also receives backing from policy changes and fresh purchase structures, which have simplified private involvement in research, creation, production, and upkeep. High-worth chances are surfacing in domains like self-driven air security systems ($19B to $24B), aerial engines ($10B to $12B), and pilotless aerial vehicles ($5B to $7B), with India seeking to bolster its role in the global supply network.

Bio-Innovations

Bio-innovations pertain to converting biological inputs into a spectrum of high-worth products such as bio-structural elements, bio-beauty, bio-nutrition additives, bio-health supplements, and bio-aromas and scents. Within bio-structural elements, two surfacing chances distinguish: bio-fuel and bio-butanediol (bio-BDO).

In recent years, India has emphasized bio-fuel as a strategic answer to progress energy self-sufficiency, attain eco goals, and boost rural earnings. The drive for this is propelled by the state's E20 directive, which targets 20% fuel blending in gasoline by 2025–26. Meanwhile, BDO - commonly utilized in solvents, plastics, flexible fibers, and foams - remains largely reliant on imports from China, the US, South Africa, and Malaysia. Given India's competitive expense foundation, there is a surfacing chance to pursue exports and satisfy the growing need for substitutes to artificial BDO over the extended term.

The transition to bio-sourced inputs is still in its nascent phases, with most efforts centered on assessing expense frameworks and viability relative to traditional inputs. As biotech grows in India, there is a chance to fund research facilities that harness India's access to cane, grain, and other inputs. To thrive as a worldwide bio-creation center, India would need to ensure steady and budget-friendly raw material origins, strategically choose facility locations, and design activities capable of managing multiple input varieties.

Prospects to Attain Worldwide Dominance

Powerhouses where a comparatively global market emphasis aligns with stronger competencies include orbital tech, vehicle parts, digital safeguards, and smart systems.

Vehicle Parts

India's vehicle parts sector is entering a robust expansion phase. Home transactions are projected to climb by 8 to 10% yearly, surpassing the wider vehicle area. The sector's core worth will stay in engine and drive systems, electrical and tech (E&T), support and stopping, and inner and outer parts.

There is also a evident change in the product blend toward more upscale options. The average transaction price for personal vehicles has risen by about 50% over the last five years ($9,000 in 2018–19 to $13,500 in 2023–24) and is further projected to rise by 15 to 40% by FY2030 as the portion of utility vehicles increases. Concurrently, shifts in drive tech are redefining the sector. EVs, for example, are projected to have a materials bill (MOB) worth that is about 1.4 times greater than that of traditional drive vehicles, even as storage prices decline. The E&T content in vehicles is also expected to grow two to three times over the next ten years, courtesy of intelligentization and the need for more linked features.

State backing via the PTI plan and steps to cut imports have assisted in boosting India's part exports, yielding a $300M trade excess in 2024 - a remarkable reversal from a $2.5B shortfall in 2019. As the worldwide market transitions toward electrification, India is well situated to position itself as a global center for premium traditional drive parts and advanced, value-enhanced vehicle systems.

Orbital Tech

In 2023, India achieved a fresh benchmark in its orbital journey when it became the fourth nation worldwide to achieve a lunar landing with its triumphant Moon Mission-3. While the Indian Orbital Research Entity (IORE) has historically guided the sector, the global scene is now shifting: More private firms are joining, and the emphasis is moving from merely satellite conception and deployments to downstream worth reservoirs, such as information handling.

The count of orbital ventures in India has expanded, from just one in 2022 to over 200 in 2024. The sector has drawn more than $450M in funding between 2021 and 2024, mirroring increasing investor enthusiasm.

Indian participants are engaged across the value network, from upstream tasks like conceiving, creating, and deploying orbital assets to midstream duties linked to the operation, oversight, and communication setup of space-based systems, as well as downstream inputs such as data uses and offerings (e.g., orbital situational knowledge and enhanced planet monitoring services). Forward-looking, India targets to boost its share of the global orbital economy from 2% in 2023 to 8% by 2033, aiming at high-expansion domains like satellite links, deployment services, and data-oriented applications. With these advancements, India's orbital sector is transitioning toward a more innovation-centered system, positioning itself for sustained expansion and greater worldwide significance.

Smart Systems

With the swift spread of creative AI since 2022, the smart systems and offerings landscape has been revolutionized, unleashing fresh potentials across sectors. About 77,000 groups have embraced Assistant in the two years since its debut. Moreover, autonomous AI is rising in prominence, hastening the uptake of mechanization and propelling the scaling of AI across processes.

With over 420,000 AI experts, India possesses a huge reservoir of IT talent. Given the worldwide shortage of AI experts, this resource proficiency positions India as a formidable competitor in a rivalrous AI offerings market.

By 2030, India's AI market could potentially contribute $14B in earnings from creative AI and autonomous AI. AI uptake hotspots are probable to exist across broad (sales and promotion, hiring, engineering, IT offerings, etc.) and specific domains (BFSI, retail, vehicles, tech, and comms and media). The deployment of AI could result in the emergence of fresh and reenvisioned expenditure reservoirs such as base models and Model Management.

Digital Safeguards

In 2024, digital offenses are projected to have inflicted worldwide economic damages valued at about $9.5T (a notable rise from $3T in 2015) equating to almost 9% of global GDP. This escalating expense to the economy has rendered digital safeguards a primary concern for enterprises and states.

India, as a primary IT offerings center, is well situated to gain from increasing worldwide digital safeguard spending, which is projected to expand from a span of 1 to 3% of global IT allocations in 2023 to 4 to 6% by 2030. Digital safeguard products and offerings are both fueling expansion, with an annual rate of 35% and 25% respectively between 2019 and 2023.

The Indian digital safeguard sector, presently valued at $30B in scale, is projected to seize a larger segment of the global digital safeguard market as overseen security offerings (OSO) providers scale by providing all-encompassing solutions including products that cover identification, reaction, and durability. As groups confront more intricate security requirements, providers that merge sturdy alliances, advanced risk knowledge, and customized client interaction are projected to mold the upcoming phase of digital safeguard innovation.

A Strategy Guide for India to Harness Value in the Powerhouses

India must capitalize on its solid basics, youthful demographic, and continuing systemic changes to maintain GDP expansion of 8.0 to 8.5% over the next two decades. Indian enterprises could mold a vibrant market and unlock the complete promise of the 18 powerhouses by embracing a tailored strategy guide for each prospect category. Some possible concepts of what that guide could entail are below:

India stands at a critical crossroads in its economic evolution, with the promise to secure 8 to 10% of global GDP by 2040. Realizing this promise will require a strategic concentration on the upcoming powerhouses of expansion, both international and homegrown. Though the exact paths of these powerhouses are challenging to predict, advancements in these powerhouses could together drive India toward its goal of worldwide economic prominence.

Source: mckinsey