Manufacturing GVA grows 10.88% CAGR in FY23-FY26, govt tells Lok Sabha
Synopsis
India's manufacturing sector clocked a 10.88% CAGR between FY23 and FY26 under a freshly revised national accounts base year — but the government itself acknowledged that manufacturing's share of total GVA has not meaningfully shifted. With medium- and high-tech industries now at 46.3% of manufacturing value added and a July PMI of 53.5, the story is one of quality improving even as the structural share challenge persists.
Key Takeaways
Manufacturing GVA grew at a CAGR of 10.88% at constant prices during FY2022-23 to FY2025-26 , per the revised national accounts series.
The government acknowledged that manufacturing's share of total GVA has shown no significant change across the series.
MoSPI revised the National Accounts Statistics base year from 2011-12 to 2022-23 , releasing the new series in February 2026 .
Medium- and high-technology industries now account for 46.3% of India's manufacturing value added, per the Economic Survey 2025-26 .
The HSBC India Manufacturing PMI stood at 53.5 in July , easing from 54.2 in June but remaining in expansion territory.
Key reforms cited include PLI Schemes , PM GatiShakti , NICDP , and initiatives covering semiconductors, MSMEs, and critical minerals.
India's manufacturing Gross Value Added (GVA) expanded at a compounded annual growth rate (CAGR) of 10.88 per cent at constant prices during 2022-23 to 2025-26, the government informed the Lok Sabha on 12 August. The figure is based on the revised National Accounts Statistics series, whose base year was shifted from 2011-12 to 2022-23 by the Ministry of Statistics and Programme Implementation (MoSPI) in February 2026.
What the Data Shows
Minister of State (Independent Charge) Rao Inderjit Singh told the House that available data under the respective series 'do not indicate any significant change in the share of manufacturing in total Gross Value Added.' In other words, while the sector is growing in absolute terms, its proportional weight within the broader economy has remained broadly stable — a nuance that the headline CAGR figure alone does not capture.
The Economic Survey 2025-26 added a structural dimension: medium- and high-technology industries now contribute 46.3 per cent of India's manufacturing value added, signalling a gradual shift toward more sophisticated production. Officials have framed manufacturing as a central pillar in the country's ambition to become a $35 trillion economy by 2047.
Policy Reforms Cited by the Government
The minister cited a suite of structural reforms credited with supporting sectoral resilience. These include the Production Linked Incentive (PLI) Schemes, the PM GatiShakti National Master Plan, the National Logistics Policy, Bharat Audyogik Vikas Yojana (BHAVYA), and the National Industrial Corridor Development Programme (NICDP).
Additional initiatives cover semiconductor and electronics manufacturing, critical minerals, Micro, Small and Medium Enterprises (MSMEs), and the Scheme for Promotion of Surface Coal/Lignite Gasification Projects, alongside ongoing ease-of-doing-business improvements. 'Collectively, these initiatives seek to strengthen domestic manufacturing, diversify supply chains, reduce import dependence in strategic sectors, enhance energy security and improve the resilience and competitiveness of India's manufacturing ecosystem,' the minister stated.
July PMI Signals Continued Expansion
On the ground-level activity front, India's manufacturing sector remained in expansion territory in July, with the HSBC India Manufacturing Purchasing Managers' Index (PMI) reading at 53.5 — above the 50-mark that separates growth from contraction. The reading was, however, softer than June's 54.2, pointing to a modest easing in the pace of growth.
Manufacturers reported sustained increases in new orders and output during the month. Firms attributed the performance to advertising efforts and underlying demand resilience, including stronger export orders.
Context and What Comes Next
The revised base-year series provides a more contemporary benchmark for measuring economic activity, but analysts note that the stable manufacturing share of GVA underscores a longstanding structural challenge: translating high sectoral growth rates into a meaningfully larger slice of the overall economy. With the PLI framework, NICDP, and semiconductor push all at various stages of implementation, the coming fiscal year will be a key test of whether policy momentum converts into sustained structural shift. Industry bodies and Parliament will likely scrutinise quarterly GVA prints closely as the revised series matures.
Point of View
But the government's own admission — that manufacturing's share of total GVA has not significantly changed — is the more telling data point. India has run multiple industrial programmes since 2014 without decisively moving the manufacturing-to-GDP needle beyond the 17-18% band. The revised base year makes historical comparisons harder, which is worth flagging: a new series can flatter growth rates without necessarily reflecting structural change. The real test for PLI, NICDP, and the semiconductor push is not CAGR but share — and on that measure, the jury is still out.
NationPress
12 Aug 2026
Frequently Asked Questions
What is India's manufacturing GVA growth rate for FY23-FY26?
India's manufacturing GVA grew at a CAGR of 10.88% at constant prices during 2022-23 to 2025-26, according to the revised National Accounts Statistics series released in February 2026. The figure was shared by Minister of State Rao Inderjit Singh in the Lok Sabha on 12 August.
Why was the national accounts base year revised?
MoSPI revised the base year of the National Accounts Statistics from 2011-12 to 2022-23 to better reflect the current structure of the Indian economy. The revised series was officially released in February 2026.
Has manufacturing's share of India's total GVA improved?
Not significantly, according to the government's own statement to the Lok Sabha. Despite a 10.88% CAGR, the data does not indicate any significant change in manufacturing's share of total GVA — a longstanding structural challenge for the sector.
What is India's Manufacturing PMI for July 2026?
The HSBC India Manufacturing PMI came in at 53.5 in July, indicating continued expansion as it remained above the 50-mark threshold. However, the pace eased from 54.2 recorded in June, reflecting a modest slowdown in growth momentum.
Which government schemes are supporting India's manufacturing sector?
The government cited several initiatives, including the Production Linked Incentive (PLI) Schemes, PM GatiShakti National Master Plan, National Logistics Policy, BHAVYA, the National Industrial Corridor Development Programme (NICDP), and programmes targeting semiconductors, MSMEs, and critical minerals.
