New Delhi: Commerce and industry minister Piyush Goyal on Wednesday asserted that flexibility and technology would be the decisive factors in India’s journey towards Viksit Bharat 2047, stating that the future of Indian manufacturing hinges on innovation and strong, resilient supply chains.

Goyal’s comments, delivered at the CII India Edge 2025 event in New Delhi, gain significance as recent data reveals a slowdown in the manufacturing sector.

The HSBC India Manufacturing Purchasing Managers’ Index, compiled by S&P Global, fell to 56.6 in November from 59.2 in October—the slowest expansion recorded since February. A PMI reading above 50 signifies expansion in activity. Analysts note that higher US tariffs appear to be weighing on demand, contributing to the slowdown.

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Addressing the need for India to strengthen sectors with a competitive edge while reducing dependence on vulnerable areas, Goyal noted that the country’s export performance is recovering after a sharp dip.

Merchandise exports had contracted by 11.8% in October, primarily driven by high tariffs imposed by the US. However, Goyal announced a strong rebound in November, although official figures are due on 15 December.

“Merchandise exports went down in October. Incidentally, November has gone up by a greater amount than what went down in October. If I aggregate October and November, there is growth in merchandise exports despite the global turmoil,” he said.

This export contraction in October contributed to India’s trade deficit widening to a record $41.68 billion that month, exacerbated by a sharp rise in gold imports. For the period between April and October this fiscal year, exports rose marginally by 0.63% to $254.25 billion, while imports increased by 6.37% to $451.08 billion.

Global pacts

Goyal further stated that India is actively working towards deeper integration with global trading partners, hinting at imminent announcements regarding successful engagements with major economies.

India is currently negotiating a series of Free Trade Agreements (FTAs) with key countries and regions, including the European Union (EU), US, New Zealand, Oman, Chile, and Peru.

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When questioned about the rupee, which hit a record low of 90.15 against the US dollar on Wednesday, Goyal stressed that the broader economy remains strong. He cited the 8.2% second-quarter GDP growth, easing inflation, stable foreign exchange reserves, and strong capital inflows as evidence that the economy remains positive and resilient despite pressure on the currency.

“Innovation must now be at the centre of India’s manufacturing push, as it is vital for self-reliance across a wide range of products. Stronger control over supply chains will help the Indian industry withstand global shocks and compete better,” the minister concluded.

Industry leaders and experts, while acknowledging the focus on innovation, voiced concerns over the slowing export engine.

Ajay Srivastava, co-founder of the Global Trade Research Initiative (GTRI), said that the upbeat Gross Domestic Product (GDP) figures “mask the fact that India’s export engine is slowing.” He pointed out that while exports account for about 20% of the economy, their role in driving jobs, incomes, and investment is significantly larger.

“Labour-intensive sectors like garments, seafood and gems are being squeezed by high US tariffs, stricter EU rules and rising protectionism, creating the risk of a two-speed economy in which services continue to grow while export-focused manufacturing falls behind,” Srivastava warned.

Industry view

Echoing similar concerns, Narayan Sethuramon of the CII Trade Policy Council called for strengthened industry–government partnerships, the establishment of early-warning systems for supply-chain risks, and an accelerated adoption of global standards.

“India needs to improve its trade ecosystem across several areas, from FTA strategy and technology partnerships to MSME upgrading, green transition, logistics reforms and stronger overseas branding, so exporters compete on capability rather than concessions,” Sethuramon stated.

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CII president Rajiv Memani emphasized the need to sharpen competitiveness reforms and develop a more focused approach to global trade. “India should study its import patterns closely to identify sectors where domestic value addition can grow quickly,” he said, suggesting that targeted incentives and closer alignment with global demand trends are crucial for the next phase of growth.