India’s landscape is rapidly evolving as the Government of India invests heavily in infrastructure projects like roads, railways, and renewable energy. One such initiative, ‘Make in India,’ aims to boost domestic manufacturing, which creates demand for machinery, construction materials, and technological solutions. Moreover, India’s manufacturing sector is now in full motion, with a prime focus on sectors such as automobiles, pharmaceuticals, and textiles. The increasing demand for data centers to support India’s expanding digital economy presents an additional opportunity in this wider segment.
In the Union Budget 2024, the infrastructure sector received an allocation of ₹11.11 lakh crore, with expectations that this may rise to ₹18 lakh crore in the upcoming Budget 2025. This could help revive falling GDP and increase India’s potential through public-private partnerships. Other schemes such as Housing for All, PM Gati Shakti, and the National Infrastructure Pipeline (NIP) will continue to add to the growth of the infrastructure sector.
The future of India’s IT industry looks bright, with the country poised to become a global leader in cloud technologies, 5G, and artificial intelligence. This potential growth is further fueled by government initiatives like Digital India, which promote the increasing adoption of cloud computing and the demand for low-latency services, leading to new opportunities in constructing data centers, IT services, and other technology-related products.
While the IT industry faced challenges in 2024 due to rising costs and declining profits, recovery in the US market is expected to boost India’s IT industry by 6% to 7% in FY 2025-26, up from 3% to 4% in the past two years.
India aims to achieve major targets in renewable energy, reaching significant capacity additions in the solar and wind sectors. This transition opens new avenues for solar panel manufacturing, wind turbine production, energy storage solutions, and grid infrastructure development. There is a strong push for clean energy through substantial government investment aimed at increasing sources of cleaner energy.In 2024, India’s installed renewable energy capacity reached 205 GW, putting it on a smooth path to achieving the 500 GW target by 2030, faster than major economies like China. Investment in this sector is expected to increase twofold to $32 billion in 2025.
India is emerging as a major global hub for electronics manufacturing, with government initiatives and shifting supply chains attracting major players to the country, further leading to job creation in this sector. Initiatives like Make in India have also helped boost India’s EMS sector.
In particular, the production of consumer electronics and mobile phones is expected to experience significant growth in the coming years. Mobile phones hold the largest market share in the EMS sector, and India is now the second-largest mobile phone manufacturer in the world. In FY24, India’s mobile phone exports increased by over 40% year-on-year to $15.6 billion.
India’s healthcare landscape is evolving, driven by rising incomes and greater health awareness. Medical tourism, digital health solutions, and preventive care are gaining significant traction. Following the pandemic, this sector has experienced substantial growth and innovation. With a market valuation of $372 billion in 2023, the healthcare sector is expected to grow to $638 billion by 2025.
There is potential in sectors related to healthcare infrastructure, telemedicine, AI-driven diagnostics, and other innovative health solutions. Schemes like Ayushman Bharat Yojana and increased awareness of health insurance products will support the sector’s growth journey.
India’s strong economic fundamentals and emphasis on innovation and technology position it as a major investment magnet. The sectors mentioned above are at the core of India’s growth narrative. Keeping a close watch on these sectors and their potential will help you better capitalize on future opportunities.
(The author Ayush Aggarwal is Chief Investment Officer at SMC Private Wealth, Director at SMC Group. Views are own)
