India Industrial Automation Market Outlook to 2030

India Industrial Automation Market Overview

• The India industrial automation market is valued at USD 15 billion, based on a five-year historical analysis. The market is primarily driven by the rapid growth of the manufacturing sector, which is adopting automation to enhance operational efficiency and reduce manual errors. The governments push for initiatives like "Make in India" and the Production-Linked Incentive (PLI) schemes has spurred investments in industrial automation technologies. Industries such as automotive, electronics, and pharmaceuticals are leading the adoption of automation solutions to meet increasing consumer demands and regulatory requirements.
• Dominant cities such as Pune, Bengaluru, and Chennai dominate the market due to their established industrial bases and favorable ecosystems for technology development and deployment. These cities are home to numerous multinational manufacturing plants and have a higher concentration of skilled labor, technological infrastructure, and R&D facilities, making them key hubs for industrial automation in India. These regions have also been pivotal in the automotive and electronics sectors, further driving automation demand.
• The Make in India initiative aims to increase the manufacturing sector's share of GDP to 500 lakh crore by 2025, prompting manufacturers to adopt automation technologies. Government policies supporting FDI in the automation sector have brought in 15,000 crore in investments in 2023 alone, with significant contributions from global companies like Siemens and ABB, which are setting up manufacturing plants in India.

India Industrial Automation Market Segmentation

By Component: Indias industrial automation market is segmented by component into hardware, software, and services. Hardware components, including sensors, actuators, and robots, hold a dominant market share. This is largely due to the critical role they play in enabling automation across manufacturing floors, from production lines to packaging processes. The growing adoption of smart sensors and industrial robots for precision control and monitoring also contributes to the dominance of this segment.

By Industry: Indias industrial automation market is segmented by industry into automotive, electronics, pharmaceuticals, oil & gas, and energy and utilities. The automotive sector has a dominant market share due to its early adoption of automation technologies such as robotics, PLCs (programmable logic controllers), and IIoT (Industrial Internet of Things). Automation in this sector has been critical for improving productivity, reducing production errors, and ensuring consistent quality in mass production environments.

India Industrial Automation Market Competitive Landscape

The Indian industrial automation market is dominated by a few key players, each contributing to the consolidation of market influence. Companies such as Siemens, ABB India Ltd., and Rockwell Automation are recognized for their advanced technologies and robust portfolios of automation solutions. Local firms, along with global giants, continue to shape the competitive landscape, where technological advancements and innovation serve as critical differentiators.

India Industrial Automation Market Analysis

Growth Drivers

• Increasing Demand for Operational Efficiency: The increasing focus on improving operational efficiency is driving the adoption of industrial automation in India. In 2023, Indian manufacturing units invested over 12,000 crores in automation systems to reduce downtime, improve production rates, and minimize human error. The automotive and electronics sectors have been leading this push for automation to meet stringent global quality standards and deadlines. For instance, Maruti Suzuki and Tata Motors integrated over 400 robotic arms into their production lines across various plants in 2022 to enhance operational workflows, leading to an average increase in output by 15% annually.
• Government Initiatives (Make in India, Production-Linked Incentive Schemes): The Government of Indias "Make in India" and "Production-Linked Incentive (PLI)" schemes have significantly accelerated industrial automation. The PLI scheme for electronics manufacturing, with a total outlay of 38,601 crore until 2025, has incentivized companies to invest in advanced automation technologies. As of 2023, more than 600 factories in India have modernized their production lines using industrial robots, AI, and Industrial Internet of Things (IIoT) technologies, resulting in more competitive exports. Additionally, the Make in India initiative aims to make India a global manufacturing hub, prompting companies to adopt automation for mass production and quality improvements.
• Adoption of Advanced Technologies (Robotics, AI, IIoT): India has seen significant growth in the adoption of advanced automation technologies like robotics, artificial intelligence (AI), and IIoT in manufacturing processes. In 2023, over 5,000 robots were installed across industries such as automotive, pharmaceuticals, and electronics. The implementation of AI and machine learning in smart factories has allowed manufacturers to optimize production lines in real-time, avoiding costly downtime. According to a 2024 report by the Ministry of Commerce, the Indian automotive sector has integrated AI-driven predictive maintenance systems across 80% of large manufacturing units, reducing operational costs by 5,000 crore annually.

Market Challenges

• High Initial Investment Costs: The implementation of advanced industrial automation technologies requires substantial capital. In 2023, the average cost of automating a manufacturing unit with AI, robotics, and IIoT systems in India was estimated to be 2.5 crore, which has proven prohibitive for small and medium-sized enterprises (SMEs). According to industry estimates, over 70% of Indian SMEs have struggled to adopt full-scale automation due to limited financial resources, despite government support through various subsidies and tax benefits.
• Limited Skilled Workforce for Advanced Automation Technologies: India faces a significant skills gap in managing and maintaining advanced industrial automation systems. A survey by the National Skill Development Corporation in 2023 revealed that only 25% of the workforce in manufacturing units is trained in operating and maintaining robotic and AI-driven systems. The shortage of skilled technicians and engineers in fields like AI, robotics, and IIoT has slowed down the widespread adoption of these technologies, with many companies forced to rely on foreign expertise for system integration and support.

India Industrial Automation Market Future Outlook

Over the next five years, Indias industrial automation market is expected to witness significant growth driven by rapid industrialization, increased investments in smart factories, and the integration of advanced technologies such as AI, IIoT, and robotics. Government initiatives aimed at boosting domestic manufacturing, especially in the automotive and electronics sectors, are likely to further fuel automation adoption. Companies are expected to invest heavily in upgrading their manufacturing processes to meet global standards of production, efficiency, and sustainability. Automation will play a critical role in achieving these objectives.

Market Opportunities

• Expansion of Automation in SMEs: There is immense potential for expanding industrial automation in Indias SME sector. As of 2023, only 25% of SMEs in the manufacturing sector have adopted automation technologies, presenting a significant growth opportunity. The Government of Indias MSME Automation Support Scheme, with an allocation of 10,000 crore by 2025, is expected to boost automation adoption in this sector. The integration of low-cost robotics and modular automation systems in SMEs could lead to an increase in output efficiency by 30%, unlocking an additional 20,000 crore in revenues annually.
• Export Potential of Automation Systems: India is becoming a key player in exporting automation systems to neighboring countries and other emerging markets. By 2023, exports of automation components such as sensors, control systems, and robotics had reached 5,000 crore. The Indian automation industry is well-positioned to increase exports further, thanks to the competitive pricing of locally produced automation systems. India's trade agreements with ASEAN countries have created additional opportunities for the export of these technologies, potentially adding another 10,000 crore to export revenues by 2025.