India’s electrical equipment industry could witness significant expansion over the next decade, driven by rising domestic demand, rapid electrification, renewable energy deployment and growing export opportunities, according to a report by McKinsey & Company titled “Wired for Growth: India’s Electrical Equipment Opportunity.” The report estimates that domestic electrical equipment production could increase from nearly Rs. 4.42 lakh crore (US$ 50 billion) in 2025 to Rs. 17.94-21.62 lakh crore (US$ 195-235 billion) by 2035. Domestic consumption is projected to reach Rs. 15.64-18.86 lakh crore (US$ 170-205 billion) by 2035, while exports could exceed Rs. 5.52 lakh crore (US$ 60 billion), strengthening India’s position as a global manufacturing and supply-chain hub. The industry is expected to expand at an annual rate of 11-13% through 2035, supported by sustained investments in power infrastructure, renewable energy, batteries, power electronics and industrial modernisation. The report noted that India has already demonstrated global competitiveness in sectors such as information technology services and auto components and has the potential to replicate similar success in electrical equipment manufacturing through a combination of policy support, innovation and entrepreneurship.
The report, however, highlighted rising import dependence as a key challenge, with imports accounting for 33% of domestic demand in 2025, compared with 22% in 2020. Under a business-as-usual scenario, import dependence could exceed 70% by 2035, resulting in a production shortfall of more than Rs. 11.96 lakh crore (US$ 130 billion). To address this challenge, McKinsey recommended a five-fold expansion in domestic manufacturing capacity, particularly in power electronics, batteries, solar photovoltaic cells and modules, transformers, air-conditioner compressors, and cables and wires. The report identified localisation as a critical strategy to reduce import dependence to below 14% by 2035 while strengthening industrial competitiveness. It also highlighted emerging opportunities in renewable energy equipment, high-speed rail and subsea cables, grid stabilisation technologies and power software, with several of these segments expected to create substantial global market opportunities over the coming decade.
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