India’s Five Most Demanded Future Emerging Industries
India’s Five Most Demanded Future Emerging Industries
India's Five Most Demanded Future Emerging Industries
Periodically, the globe welcomes advancements and fresh technologies. Among these, some endure and prove their worth by addressing problems, minimizing expenses, or enhancing operational efficacy. Businesses that participate in creating and disseminating such technologies and inventive products or services, from the early stages, ultimately become future-ready sectors that provide appealing investment prospects.
This article examines five potential future industries in India that have the potential to thrive. Additionally, we explore their growth potential and specific stock options within these sectors in India. India is a rapidly growing economy with a large, young population and a thriving startup ecosystem. Here are five of the most in-demand emerging industries in India:
1.Semiconductor sector in India
Semiconductors, which are tiny chips that regulate the flow of electricity in electronic devices, are used in a wide range of products, including air conditioners, central processing units, rice cookers, smartphones, electric vehicles, and automated teller machines.
Despite this, India currently depends entirely on imports to meet its semiconductor needs. However, the Ministry of Electronics and Information Technology (MEITY) predicts that India’s semiconductor market will expand to $63 billion by 2026, which is four times its current market size. Therefore, the government has implemented several measures to reduce India’s reliance on imports and transform the country into a global semiconductor hub.
Under the Production-linked Incentive (PLI) program, the government has allocated Rs. 76,000 crores to support semiconductor and display manufacturing. Additionally, the Semicon India Program has been initiated to encourage semiconductor companies to establish and operate facilities in India, and both domestic and international players have expressed interest in this initiative. With these measures in place, the semiconductor industry could emerge as one of India’s fastest-growing industries.
2. Renewable Energy
India is one of the world’s largest consumers of energy, and as the country continues to grow, so will its energy needs driven by a combination of government policies, technological advancements, and increasing public awareness of the need to reduce greenhouse gas emissions and combat climate change. Renewable energy, including solar, wind, and hydropower, is seen as a critical component of India’s energy mix, and the government has set ambitious targets to increase its share of renewables in the coming years.
As per the India Brand Equity Foundation (IBEF), India ranks fourth in the world for renewable energy capacity and wind power, as well as fifth for solar power capacity. In addition, we held the third position in the EY Renewable Energy Country Attractive Index 2021 in October of that year.
Renewable energy is generated using natural resources that are capable of being replenished, such as solar, water, and wind.The Central Electricity Authority predicts that our power requirements will reach 817 GW by 2030, with a goal of meeting 50% of our total energy needs with renewable energy sources by that same year. This bright outlook makes the future of the renewable energy sector in India very promising.
Here are some key trends and developments in the renewable energy market:
- Solar Power: Solar energy is the fastest-growing source of renewable energy, with solar panels becoming increasingly affordable and efficient. The global solar power market is projected to grow at a compound annual growth rate of over 20% from 2021 to 2026, driven by increasing adoption of solar panels in residential, commercial, and industrial sectors.
- Wind Power: Wind power is the second-largest source of renewable energy, with the global wind energy market projected to grow at a compound annual growth rate of over 7% from 2021 to 2026. This growth is driven by increasing investment in offshore wind projects and advancements in wind turbine technology.
- Hydroelectric Power: Hydroelectric power remains an important source of renewable energy, particularly in countries with abundant water resources. The global hydroelectric power market is projected to grow at a compound annual growth rate of over 2% from 2021 to 2026.
- Geothermal Power: Geothermal power is a relatively small but growing source of renewable energy, with the global geothermal power market projected to grow at a compound annual growth rate of over 3% from 2021 to 2026. This growth is driven by increasing investment in geothermal projects, particularly in countries with high geothermal potential.
- Bioenergy: Bioenergy, including biofuels and biomass, is a diverse and rapidly growing source of renewable energy, with the global bioenergy market projected to grow at a compound annual growth rate of over 5% from 2021 to 2026. This growth is driven by increasing investment in biofuels and biomass power projects, particularly in countries with abundant agricultural resources.
Overall, the renewable energy industry is expected to continue growing in the coming years, driven by increasing demand for clean energy and declining costs of renewable energy technologies. However, challenges such as grid integration and energy storage will need to be addressed in order to fully realize the potential of renewable energy.
With the rise of internet penetration and a growing middle class, e-commerce has exploded in India in recent years. The sector is expected to continue to grow rapidly, driven by factors such as increasing consumer confidence in online shopping, the growth of digital payments, and the rise of social commerce.
Among the primary causes driving this expansion are:
- Increasing internet penetration: The number of internet users in India has been steadily increasing, and this has resulted in a growing number of people who are comfortable with shopping online.
- Rising disposable incomes: With an increase in disposable incomes, more people are now able to afford online shopping, which has contributed to the growth of the eCommerce industry.
- Government initiatives: The Indian government has introduced several initiatives to promote eCommerce, such as the Digital India program and the Make in India campaign, which have helped to boost the industry.
- Mobile penetration: With the increasing availability of affordable smartphones, more people in India are now able to access eCommerce sites using their mobile devices.
According to a report by Statista, the eCommerce market in India was valued at US$38.5 billion in 2020 and is projected to reach US$99 billion by 2024, growing at a CAGR of 27.4% during the forecast period. The report also highlights that the fashion segment is the largest eCommerce category in India, followed by electronics and media.
Overall, the eCommerce industry in India is poised for continued growth in the coming years, driven by favourable demographic and economic factors, increasing consumer demand, and ongoing digital transformation efforts.
4. Artificial Intelligence
The artificial intelligence (AI) industry in India has seen significant growth in recent years and is expected to continue to expand in the future. According to a report by Analytics India Magazine, the Indian AI industry is expected to reach $16.2 billion by 2025, growing at a CAGR of 32.6% from 2020 to 2025.
Artificial intelligence (AI) is increasingly being integrated into a range of industries in India, including healthcare, agriculture, and education. The government has identified AI as a key strategic area for investment, and startups working in this space have received significant funding in recent years.
The AI industry in India pertains to machines, systems, or robots controlled by computers that can perform human-like tasks and improve themselves based on collected information. Various sectors in the economy such as self-driving cars, smart assistants, manufacturing robots, healthcare management, and automated financial investing utilize AI technology. India is considered one of the top three markets for AI talent globally, representing 16% of the total pool. A joint study conducted by Microsoft and the Internet and Mobile Association of India (IAMAI) predicts that India’s AI market will experience a 20% growth rate over the next five years.
However, the growth of the AI industry in India can be attributed to several factors, including the availability of a large pool of skilled IT professionals, the presence of top engineering colleges, the government’s support for AI research and development, and the increasing adoption of AI technologies across various sectors.
Some of the major players in the Indian AI industry include Infosys, Wipro, TCS, HCL Technologies, and IBM. These companies are leveraging AI technologies to develop innovative solutions for their clients in various industries, including healthcare, finance, retail, and manufacturing.
In addition, several startups are also emerging in the Indian AI industry, focusing on developing AI-based solutions for specific industries or use cases. Some notable startups include Niramai, which uses AI for early detection of breast cancer, and SigTuple, which uses AI for automated analysis of medical images.
Overall, the AI industry in India is poised for significant growth in the coming years, driven by technological advancements, increasing demand for AI solutions, and government support.
5.Internet of Things (IoT) sector in India
The Internet of Things (IoT) industry refers to the network of connected devices and sensors that communicate with each other to automate and optimize various processes. This industry has been growing rapidly in recent years, driven by the increasing availability of affordable sensors, the widespread adoption of cloud computing and big data analytics, and the proliferation of internet-connected devices.
This can include anything from a heart monitor implant in a person to built-in sensors in an automobile, all connected through the Internet Protocol (IP) address. The implementation of IoT across various industries has helped achieve operational efficiency, enhance customer service, and improve decision-making. IoT is used to connect everyday objects such as cars, kitchen appliances, and thermostats to communicate with each other.
With the introduction of 5G connectivity, IoT solutions will further expand and find applications in areas like home automation and security.
According to market research reports, the global IoT market size is expected to reach $1.6 trillion by 2025, growing at a compound annual growth rate (CAGR) of 24.9% from 2020 to 2025. The market is expected to be driven by the increasing adoption of IoT in industries such as healthcare, manufacturing, automotive, and agriculture, as well as the growing demand for smart homes and smart cities.
The healthcare industry is also expected to be a major adopter of IoT technology, as it enables remote monitoring of patients, improves the efficiency of healthcare delivery, and reduces costs. The healthcare IoT market is expected to grow at a CAGR of 25.2% from 2020 to 2025.
In terms of geography, North America is expected to be the largest market for IoT technology, driven by the high adoption of smart homes, smart cities, and IIoT in the region. Asia-Pacific is expected to be the fastest-growing market, driven by the increasing adoption of IoT in China, India, and Southeast Asia.
Overall, the IoT industry is expected to continue growing rapidly in the coming years, driven by the increasing adoption of connected devices, the proliferation of 5G networks, and the growing demand for real-time data analytics and automation.
India has seen a significant growth in emerging industries in recent years. The government’s emphasis on digitization, innovation, and entrepreneurship has helped to foster these industries.
Overall, the emerging industries in India have the potential to create jobs, drive economic growth, and improve the standard of living for the people. However, there are also challenges that need to be addressed, such as regulatory hurdles, infrastructure bottlenecks, and access to funding. Nonetheless, with the right policies and support, India can continue to nurture these emerging industries and become a leader in innovation and technology.
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