India

India Targets 120 Products for Domestic Production to Cut Import Dependence

By Sidhartha

The Indian government has identified about 120 products—including intermediates, capital goods, chemicals such as acetic acid, pharmaceutical inputs, medical technology items, machine tools, textile looms, construction equipment, cranes, and aerospace maintenance, repair and operations (MRO) components—for a domestic manufacturing push. The list also covers consumer goods, including items in the footwear value chain. The initiative, led by the Department for Promotion of Industry and Internal Trade (DPIIT), follows China’s restriction on tunnel boring machine shipments, prompting a separate plan for those machines.

Three types of intervention are planned. First, short‑term protection will allow the identified products to compete against overseas imports, especially from China, until supply chains are diversified—a strategy similar to that used for mobile phones in earlier years. Second, cost‑disability measures will provide incentives, such as capital support or phased assistance linked to turnover. Third, research and development assistance will be offered for products that require local technology development.

Over the past six to eight years, the government has supported companies across sectors—pharma, electronics, semiconductors, solar power equipment, and white goods—to boost local production. Funding has largely flowed through public‑listed companies, two semiconductor missions, and a scheme to enhance electronic component manufacturing, responding to rising input demand after domestic phone production accelerated.

R&D support reflects lessons from battery and solar panel production, where domestic companies import cells from China and assemble battery packs, keeping the core technology abroad. The plan aligns with India’s Atmanirbhar Bharat strategy, which has gained renewed focus after the West Asia crisis exposed shortages of critical items due to heavy import reliance. Even during the Covid pandemic, supply of medical inputs was disrupted as China controlled key production chains.