Goods

India’s capital goods sector is a key driver of industrial growth, supporting infrastructure, manufacturing, and technological advancement. It accounts for 21.5% of total manufacturing, underscoring its strategic importance to the economy.

The sector spans 11 sub-segments, led by Power & Electrical Equipment, Plant Process Equipment, Earthmoving & Mining Machinery, Textile Machinery, and Machine Tools. India is the third-largest construction equipment market globally, driven by rapid urbanization and large-scale infrastructure development.

As per the Indian Electrical and Electronics Manufacturers’ Association (IEEMA), the electrical equipment segment has seen consistent double-digit growth, particularly in transmission equipment and transformers, supported by strong domestic demand and export expansion. In 2023–24, Process Plant Equipment led capital goods exports at US$1 billion, followed by Earthmoving & Mining Machinery (US$700 million), Textile Machinery (US$445 million), Food Processing Machinery (US$415 million), and Printing Machinery (US$236 million)—highlighting a diversified export base.

India is also among the top five global FDI destinations across key segments such as Plant Process Equipment, Machine Tools, Earthmoving & Mining Machinery, and Power & Electrical Equipment, reflecting strong investor confidence. The sector benefits from a liberal policy regime, including 100% FDI under the automatic route (except for countries sharing land borders with India), no industrial licensing requirements, no restrictions on technology transfer payments, and free import-export policies.

Government initiatives continue to strengthen the sector by boosting domestic manufacturing, reducing import dependence, and enhancing competitiveness. The SECC scheme supports technology upgradation, skill development, and infrastructure (including CEFCs and testing facilities), while export promotion is driven by schemes such as MOOWR, RoDTEP, EPCG, and Duty Drawback.