India: Redefining the Future of Global Mobility and Economic Leadership
India’s economic story has captivated the world. In FY24, India’s GDP reached USD 3.94 trillion, making it the 5th largest globally. With a growth rate of 6.9% in FY24 and a projected 6–7% annual growth for the next three years, India is on a path to becoming the 3rd largest economy by 2027. By 2047, India is poised to hit a staggering USD 37 trillion GDP, representing a shift in the global economic order.
This rapid ascent is being driven by a combination of demographic advantages, strategic economic policies, technological innovation, and a robust automotive sector. As the automotive industry continues to expand, India is positioning itself as not just a major player in the global mobility market but also a leader in sustainability and cutting-edge technologies.
The manufacturing sector, a critical pillar of India’s growth, is set to contribute 25% of GDP by 2025. The government’s ambitious target of achieving USD 1 trillion in merchandise exports by 2030 showcases the nation’s commitment to becoming a global trade leader. This growth is bolstered by India’s young, skilled workforce, projected to reach 522 million by 2030, with an average age of 28.
Urbanization is another key driver of India’s growth, with 87 megacities expected by 2030, each with over 1 million residents. These urban centers will contribute 70% of India’s GDP, underlining the critical role of cities in the nation’s future.
Digital India: A Cashless Economy and a Global Leader
India’s digital revolution is another significant factor fueling its economic rise. Initiatives like the digitalization of tax collection and the introduction of GST reforms are making governance more efficient.
The country has pioneered digital payment systems, with the Unified Payments Interface (UPI) and RuPay leading the way in creating a cashless economy. In 2024, India led the world with 156 billion digital transactions worth USD 2.92 trillion. The digital transformation is also empowering Micro, Small, and Medium Enterprises (MSMEs), with 7.9 million MSMEs embracing digital tools in FY2023.
India is not only advancing in digital infrastructure but also emerging as a leader in global mobility solutions. Prime Minister Narendra Modi’s inauguration of the Bharat Mobility Global Expo 2025 underscores the importance of the automotive and mobility sectors in India’s future. The expo, expected to showcase over 100 new launches, highlights India’s role as a hub for innovation and technology in the global automotive landscape.
As PM Modi emphasized, the country’s large population, growing middle class, urbanization, and government infrastructure investments are key factors driving growth in the automotive sector. With infrastructure spending set at ₹11 lakh crore in the last year, the government is creating a network of highways and expressways that will facilitate further growth in vehicle demand. The Prime Minister also highlighted the country’s commitment to sustainable mobility, focusing on Electric Vehicles (EVs), hydrogen fuel, and biofuels.
India’s Automotive Industry: A Global Mobility Hub
The Indian automotive sector, valued at USD 240 billion, is a cornerstone of the country’s economy. Contributing 7% to the GDP, the sector is a significant driver of economic activity. India is the world’s largest manufacturer of three-wheelers and tractors and the second-largest producer of two-wheelers. It also ranks as the third-largest passenger vehicle market globally and is the fourth-largest passenger vehicle manufacturer.
Indian automotive exports are growing rapidly, with the sector accounting for 7% of the country’s overall merchandise exports. In FY2023, automotive exports soared to USD 33.2 billion, growing at a compound annual growth rate (CAGR) of 7%. The industry’s growth is not only fueled by domestic demand but also by the increasing role of India as a manufacturing and export hub for global automakers.
The government’s focus on sustainability is propelling India’s automotive industry into a new era of green mobility. The country has committed to achieving net-zero emissions by 2070, with interim targets to reduce carbon emissions by 1 billion tons by 2030 and to reduce carbon intensity by 45% by 2030 compared to 2005 levels.
Electric and flex-fuel powertrains are at the forefront of this transition. EV sales in India saw a 640% increase over the last decade, with over 16.8 lakh units sold in 2024 alone. By 2030, EV sales are projected to increase eightfold, with significant growth expected in electric two-wheelers, three-wheelers, and passenger vehicles.
Revolutionizing Infrastructure and Logistics for the Future
India’s ambitious infrastructure development is a crucial enabler of its economic and automotive growth. In FY2024, the country’s public infrastructure investment reached USD 213 billion, contributing 5.5% of India’s GDP. With over 160,000 kilometers of national highways expected to be completed by FY2025, the government is laying the foundation for enhanced mobility and trade.
The logistics sector is also undergoing a transformation. Rail cargo is expected to grow by 52%, ports by 67%, and airports by 197% in the coming years. To further optimize logistics, the government plans to establish 35 multi-modal logistics parks by 2030, under the Bharatmala Pariyojana, with an INR 50,000 crore investment.
Power generation is also expanding, with 1,800 billion units of electricity projected to be generated by FY2025. This growth is essential for meeting the increased demand for electric vehicles and supporting the nation’s push for renewable energy.
India’s Vision for a Sustainable, High-Tech Mobility Future
India’s automotive and mobility future is not just about economic growth but also about leading the world in sustainable, cutting-edge technologies. The country is focusing on advancing mobility solutions through initiatives like the Production-Linked Incentive (PLI) schemes, which have a combined outlay of USD 26 billion to support R&D in semiconductors, automotive components, and electric vehicle technology.
India is also making significant strides in the electric mobility space, with 1.32 million charging stations expected by 2030. The government is promoting the deployment of 10,000 electric buses and supporting the growth of a green hydrogen economy, with a target of 5 million tons of green hydrogen production annually by 2030.
Prime Minister Modi’s vision for India’s mobility future is captured in the “7 Cs” of mobility solutions: Common, Connected, Convenient, Congestion-Free, Charged, Clean, and Cutting-Edge. These principles are guiding India’s transition to a cleaner, more efficient, and technologically advanced automotive landscape.
India’s push for a greener future is not limited to EVs and hydrogen. The country’s natural gas (CNG) network now covers 98% of the population and 88% of the geographical area, providing an alternative, low-emission fuel option for millions of Indians.
India’s Automotive Innovation and Global Competitiveness
India is increasingly becoming a global hub for automotive innovation, with over 60 global automotive giants, including Volvo and Daimler, establishing their R&D centers in the country. The 100% Foreign Direct Investment (FDI) policy under the automatic route is further encouraging international players to set up manufacturing and innovation hubs in India.
In the EV sector, India’s new policy reducing import duties on completely built-up (CBU) electric vehicles to 15% is expected to attract major international players to invest in manufacturing facilities within the country. This move, combined with the government’s investment in infrastructure and innovation, positions India as a leading destination for global automotive players looking to capitalize on the country’s growing market and manufacturing capabilities.
A Bright Future for India’s Automotive and Mobility Sectors
India’s automotive and mobility sectors are poised for unprecedented growth. With its strong economic trajectory, demographic advantages, and a commitment to sustainable technologies, the country is positioning itself as a global leader in the future of mobility. The government’s focus on infrastructure, digitalization, and clean energy solutions will further accelerate the nation’s transition to a high-tech, sustainable mobility ecosystem.
As Prime Minister Modi aptly stated at the Bharat Mobility Global Expo 2025, “The future belongs to the East, Asia, and India.” India’s role in shaping the global automotive and mobility landscape is undeniable, and its continued commitment to innovation, sustainability, and technological advancement will ensure it remains a key player in the years to come.
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