Make in India Efforts Showing Results as Import Dependence Falls in Key Sectors Despite Global Shocks: Bank of Baroda

Why It Matters

Reduced import reliance strengthens India’s manufacturing resilience against global supply shocks and supports the government’s self‑reliance agenda. The trend signals a maturing domestic ecosystem that can attract investment and lower exposure to commodity price volatility.

Key Takeaways

• Electrical import intensity fell from 22.7% to 13.7% FY19‑FY25.
• Chemical sector import ratio dropped to 22.5% from 27.5% FY19‑FY25.
• Carbon black imports fell to 35.6% of sales, down from 55%.
• Make in India, semiconductor mission, and chemical parks boost self‑reliance.
• Industrial gases, fuels, and non‑ferrous metals stay import‑dependent.

Pulse Analysis

India’s "Make in India" drive is beginning to show measurable outcomes, according to a Bank of Baroda report that tracks import‑to‑net‑sales ratios across 1,372 non‑financial firms. While the aggregate import intensity of corporate India has barely shifted—22.3% in FY25 versus 22.9% in FY19—sector‑level data reveal a clear pivot toward domestic sourcing. This subtle but steady decoupling from foreign inputs is especially pronounced in high‑value manufacturing segments, where policy support has been most aggressive.

The electrical and chemical sectors illustrate the depth of the shift. Electricals saw their import ratio plunge from 22.7% to 13.7%, with cable imports falling to 12.5% and electronic components to 25.8% of sales. In chemicals, the overall ratio slipped to 22.5%, driven largely by a reduction in carbon black imports—from a staggering 55% of sales in FY19 to 35.6% in FY25. These gains are tied to targeted programs: the India Semiconductor Mission 2.0, the expanded Electronics Components Manufacturing Scheme, Rare Earth Corridors, and the creation of dedicated chemical parks. Together, they provide incentives, infrastructure and a clearer regulatory pathway for firms to substitute imports with locally produced inputs.

The strategic impact is twofold. First, a lower import footprint cushions the economy from external shocks, such as the recent West Asia crisis that pushed crude oil prices up 31% and lifted industrial metal costs. Second, it signals to global investors that India is building a more self‑sufficient supply chain, potentially unlocking new capital for high‑tech and green‑energy manufacturing. However, vulnerabilities persist in sectors like industrial gases, fuels and non‑ferrous metals, where import dependence remains high. Ongoing monitoring and sector‑specific policies will be essential to ensure the broader resilience of India’s manufacturing landscape.