India has overtaken China as the top destination for new manufacturing investment according to a landmark study by a major global consultancy, reflecting a structural shift in global supply chains driven by geopolitical diversification strategies and India’s improving infrastructure and business environment.

The shift is most pronounced in electronics, pharmaceuticals, and textiles, where multinational companies have been systematically building out Indian production capacity as part of “China plus one” strategies. India’s Production-Linked Incentive (PLI) schemes have been particularly effective in attracting investment in smartphone manufacturing and semiconductor packaging.

Labor cost advantages, a large English-speaking technical workforce, and improving logistics infrastructure are cited as key factors. India’s port modernization program and dedicated freight corridors have significantly reduced logistics costs, narrowing a historical competitive disadvantage relative to China.

Economists project that manufacturing’s share of Indian GDP could rise from 17% to 25% by 2030 if current investment trends continue, creating tens of millions of jobs in the formal economy.