Make in India Completes 12 Years: PLI Schemes Attract ₹2.40 Lakh Crore Investment, India Becomes World's 2nd Largest Mobile Phone Manufacturer

Why in News

Make in India, India's flagship manufacturing and investment promotion initiative, completed 12 years on 25 September 2026. Prime Minister Narendra Modi marked the occasion by highlighting key achievements: India's rise to the world's second-largest mobile phone manufacturer, near-sevenfold growth in electronics production, and the impact of Production Linked Incentive (PLI) schemes which attracted ₹2.40 lakh crore in actual investment and generated ₹23.8 lakh crore in production/sales by March 2026.

Background

Make in India was launched on 25 September 2014 at Vigyan Bhavan, New Delhi, by Prime Minister Narendra Modi. It was designed to address India's chronic underperformance in manufacturing — the sector's share in GDP had stagnated around 15–16%, well below the 25% target set by the National Manufacturing Policy (NMP), 2011. The initiative aimed to attract domestic and foreign investment, foster innovation, develop manufacturing infrastructure, and position India as a global hub for manufacturing, design, and innovation.

The initiative was initially built around 25 focus sectors and was later upgraded to Make in India 2.0 covering 27 sectors (15 manufacturing and 12 services), with sharper sectoral strategies aligned to global value chains.

Current Developments

On the 12th anniversary, the government released a comprehensive data package. Electronics and mobile phones emerged as the standout success stories. India's electronics production grew from ₹1.9 lakh crore in 2014-15 to ₹13.11 lakh crore in 2025-26 — a nearly sevenfold increase. Mobile phone production alone surged from ₹18,000 crore to ₹6.27 lakh crore — a 33-fold increase, propelling India to become the world's second-largest mobile phone manufacturer by volume.

PLI (Production Linked Incentive) schemes, launched in 2020 across 14 key sectors, have become the operational backbone of Make in India 2.0. As of March 2026: actual investment under PLI stood at ₹2.40 lakh crore; cumulative production and sales reached ₹23.8 lakh crore; exports facilitated by PLI totalled ₹15.2 lakh crore; and 14.6 lakh direct and indirect jobs were generated.

Key Facts

Make in India 2.0 sectors: 15 manufacturing (electronics, pharmaceuticals, medical devices, automobiles and auto components, advanced chemistry cells, textile products, food processing, telecom, white goods, specialty steel, solar PV, textiles, shipbuilding, defence, toys) + 12 services (IT, BPO, financial services, tourism, etc.).

Legal Framework

Make in India does not have a standalone statute. It operates through a combination of:

• FDI Policy (under FEMA, 1999 and DPIIT Press Notes): Progressively liberalised to allow 100% FDI under automatic route in most manufacturing sectors
• PLI Scheme Notifications: Each PLI scheme is approved by the Cabinet and notified by the concerned Ministry under applicable laws (e.g., Customs Act exemptions, Income Tax concessions)
• National Manufacturing Policy, 2011: The statutory policy framework providing the 25% GDP target
• Industrial Policy, 1991 and subsequent amendments: Enabled private sector entry into sectors previously reserved for the public sector
• National Logistics Policy, 2022: Supports manufacturing competitiveness through reduced logistics costs (target: 8% of GDP from ~13%)

Institutional Framework

• DPIIT (Department for Promotion of Industry and Internal Trade): Nodal department for Make in India; manages the initiative's website and coordinates across ministries
• Invest India: National Investment Promotion and Facilitation Agency; single-point interface for investors
• NICDC (National Industrial Corridor Development Corporation): Develops smart industrial cities (Delhi-Mumbai, Chennai-Bengaluru corridors)
• Ministry of Commerce and Industry: Parent ministry
• Sectoral PLI Ministries: Ministry of Electronics and IT (MeitY), Ministry of Pharmaceuticals, Ministry of Textiles, etc. implement respective PLI schemes

Economic Dimensions

India's FDI inflows have grown significantly since 2014, with the country attracting cumulative FDI equity inflows exceeding US$700 billion in the 12 years of the initiative. Manufacturing's share in GVA improved from 14.6% to 15.6%, though this falls short of the NMP 2011 target of 25%.

The electronics sector's success demonstrates the power of demand-supply alignment: India's large domestic smartphone market (one of the world's largest) provided the demand base while PLI incentives de-risked investments by global OEMs (Original Equipment Manufacturers) like Apple (Foxconn, Pegatron, Tata Electronics), Samsung, and Dixon Technologies.

Sectors still lagging: capital goods, heavy machinery, and chemicals — areas where India's factor cost disadvantage relative to China remains significant.

Banking and financial angle: The Export-Import (EXIM) Bank, SIDBI (Small Industries Development Bank of India), and NABARD provide targeted credit lines for PLI-linked MSMEs. The RBI's priority sector lending guidelines include MSME manufacturing, channelling bank credit to the sector.

Environmental Dimensions

The PLI scheme for Advanced Chemistry Cells (ACC) and Solar PV Modules directly supports India's clean energy transition. India has set a target of 500 GW renewable energy capacity by 2030 (updated NDC under Paris Agreement). Domestic manufacturing of solar cells reduces import dependence (previously ~90% imported from China) and supports the Atmanirbhar Bharat clean energy goal. However, the rapid industrialisation under Make in India raises concerns about effluent management, solid waste, and land use in industrial corridors.

Challenges

• Manufacturing GVA stagnation: Despite improvements, manufacturing's 15.6% share in GVA remains far below the NMP target of 25%
• Linkage to domestic MSMEs: Much of the PLI benefit has accrued to large firms and MNCs; backward linkages to MSMEs and ancillary industries remain underdeveloped
• Logistics costs: At ~13% of GDP, India's logistics costs are significantly higher than global benchmarks (~8%), eroding manufacturing competitiveness
• Labour laws and flexibility: Despite the four Labour Codes, implementation gaps persist at the state level
• Land acquisition: Industrial corridor and SEZ land acquisition remains contentious in many states
• China competition: China's manufacturing ecosystem — with deep supply chains, scale, and aggressive pricing — remains a formidable competitor

Government Initiatives

• PLI Schemes (14 sectors): ₹1.97 lakh crore total incentive outlay approved
• National Industrial Corridor Programme: 11 industrial corridors planned; Delhi-Mumbai Industrial Corridor (DMIC) most advanced
• PM GatiShakti National Master Plan: Integrated multimodal infrastructure planning to reduce logistics costs
• Semiconductor Mission (India Semiconductor Mission): ₹76,000 crore incentive package for chip fabrication and packaging
• Defence indigenisation: Positive indigenisation lists to substitute imports with domestic production
• National Logistics Policy, 2022: Targets 8% logistics cost/GDP; sets up Unified Logistics Interface Platform (ULIP)

Way Forward

NITI Aayog's Competitiveness Roadmap for India@100 and the Economic Survey have consistently highlighted that achieving a 25% manufacturing share requires: (1) deep integration with global value chains (GVCs) rather than import substitution alone; (2) investment in skills (particularly industrial ITIs and polytechnics); (3) reducing the cost of logistics, power, and capital; and (4) strengthening MSME participation in PLI supply chains. The Parliamentary Standing Committee on Commerce has recommended mandatory MSME sub-contracting quotas within PLI schemes to ensure broader economic benefit.

Possible Mains Questions

1. "Production Linked Incentive (PLI) schemes have been hailed as a game-changer for Indian manufacturing. Critically assess their achievements and limitations after six years." (GS-III, 15 marks)
2. "India's ambition to become a global manufacturing hub faces structural constraints that policy alone cannot resolve. Examine." (GS-III, 15 marks)

Possible Prelims MCQs

1. Q: Make in India was launched on which date?
   A: 25 September 2014
   Explanation: Launched at Vigyan Bhavan, New Delhi by Prime Minister Modi on 25 September 2014.
2. Q: How many sectors are covered under Make in India 2.0?
   A: 27 (15 manufacturing + 12 services)
   Explanation: Make in India 2.0 expanded from 25 to 27 sectors with a sharper sectoral strategy.
3. Q: Which department is the nodal agency for Make in India?
   A: DPIIT (Department for Promotion of Industry and Internal Trade)
   Explanation: DPIIT under the Ministry of Commerce and Industry coordinates the Make in India initiative.

Essay Dimensions

1. Manufacturing as the engine of India's development: aspiration versus reality
2. The China factor: can India realistically become the world's factory?
3. From Make in India to Make for the World: India's evolving industrial ambition
4. The MSME paradox: small firms, large potential, limited gains from industrial policy
5. Sustainability and industrialisation: can India grow its manufacturing sector without sacrificing its environmental commitments?

Interview Questions

1. What is the difference between an SEZ (Special Economic Zone) and an NIMZ (National Investment and Manufacturing Zone) under Make in India?
2. India ranks 36th on the World Bank Ease of Doing Business Index. What are the key barriers still preventing India from reaching the top 10?
3. How do PLI schemes differ from traditional investment subsidies? What is the conditionality mechanism?
4. Why has India succeeded in electronics but struggled in capital goods manufacturing?
5. What is the role of the India Semiconductor Mission and why is semiconductor manufacturing strategically critical?

FAQ

Q: What is a PLI (Production Linked Incentive) scheme?

A PLI scheme provides financial incentives to manufacturers based on incremental sales/production over a base year. Unlike upfront subsidies, PLI is performance-linked — a company gets the incentive only after achieving specified production targets. This reduces fiscal risk and rewards actual output. PLI schemes operate across 14 sectors with a total approved outlay of approximately ₹1.97 lakh crore.

Q: What is Invest India?

Invest India is the National Investment Promotion and Facilitation Agency, set up as a non-profit entity under the Ministry of Commerce and Industry. It serves as the single-point interface for domestic and foreign investors, providing handholding, regulatory guidance, and facilitation services for investment proposals.

Q: What is the National Manufacturing Policy 2011?

The NMP 2011 was India's first comprehensive industrial policy targeting a 25% share of manufacturing in GDP by 2025, and creating 100 million jobs. It introduced the concept of NIMZs (National Investment and Manufacturing Zones) — large integrated industrial townships with world-class infrastructure and a simplified regulatory environment.

Further Reading

• DPIIT Make in India portal — makeinindia.com
• Invest India — investindia.gov.in
• PIB: 12 years of Make in India release
• National Manufacturing Policy, 2011 — Ministry of Commerce and Industry
• Economic Survey 2025-26 — Chapter on Manufacturing and Investment