AUGUST, 20259GOVERNMENT IDENTIFIES KEY MANUFACTURING SECTORS TO ATTRACT FDIIn the midst of global uncertainty and slow net FDI into India (only US$3.9 billion in April­May), the government, through Invest India, has identified six key sectors to bring in foreign investments: electronics system design and manufacturing (ESDM), non-leather footwear, chemicals, medical devices, toys and electric vehicles (EVs). These sectors are receiving priority through Production Linked Incentive (PLI) plans and coordination with state governments to encourage diversity to reduce reliance on China.India now provides 100% FDI via automatic route in several vital manufacturing sectors, including auto-components, pharmaceutical greenfield, renewable energy, telecom, textiles, construction, and others. This permissive framework supports India's aspiration to reach a US $100 billion in annual foreign direct investment on a global scale.Electronics manufacturing and EVs are central to this strategy. Recent investments, including Foxconn's and brands wanting to make EVs, express confidence in India's ability to scale up and shift to localized value chains. Toy manufacturing is also picking up as Indian manufacturers want to shift from an 88% share of the domestic market into exporters.The government is working with seven priority states, or manufacturing hubs - Maharashtra, Tamil Nadu, Andhra Pradesh, Gujarat, Karnataka, Uttar Pradesh, and Odisha - in terms of strengthening investment facilitation, aligning incentives under the PLI scheme, and planning global roadshows. To support its industrial strategy, key policy initiatives like the Jan Vishwas Bill 2.0 emphasize the need to simplify regulatory norms, thus promoting the ease of doing business for foreign investors.Foreign direct investment (FDI) rose by 14% during FY2024­25 to US$81 billion, aided by developments in sectors like services (financial and IT) and computer software or hardware and trading. Services will remain the leading sector, but the manufacturing strategy orientates India towards rebalancing, by way of encouragement of industrial growth across priority sectors. IMRTOP STORIESGODREJ AEROSPACE SECURED MANUFACTURING DEAL WITH PRATT & WHITNEYGodrej Aerospace, part of Godrej Enterprises Group, has finalized a deal with Pratt & Whitney, part of RTX for the manufacture of quite complex components for aircraft engine applications.This is a significant milestone for Godrej in making significant commitments toward aerospace manufacturing capability development and pushes Godrej closer to its objective to become a global supplier of aircraft engines.At present, Godrej Aerospace works from 35,000 square metres of manufacturing facilities, and are developing an additional 48,500 square metres in India. Norbert was clear on the alignment of further expansion entirely with the strategy in contributing to India establishing itself in the global precision engineering and aerospace supply chain."This contract with Pratt & Whitney is not just a business milestone ­ it is a testament to India's rising capabilities in complex aerospace manufacturing. By leveraging our advanced infrastructure, deep expertise, and commitment to global quality standards, we are proud to play a role in shaping the future of aviation manufacturing in India", Maneck Behramkamdin, Business Head of the Aerospace business at Godrej Enterprises Group stated.With the Pratt & Whitney engagement, Godrej are expecting more advanced technologies and on a larger scale of activities; all of which will reinforce the company's position in high precision component manufacturing. This also demonstrates India's growing competitiveness and opportunity as a trusted partner in the global aerospace ecosystem. IMR· Godrej Aerospace to manufacture aircraft engine parts for Pratt & Whitney.· Deal boosts Godrej's global role in aerospace supply chains.· Expanding facilities to strengthen India's precision manufacturing.
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