India has ranked sixth among 11 Asian economies in the Asia Manufacturing Index (AMI) 2026, highlighting the need for a sharper and more coordinated policy push to strengthen its position in the regional and global manufacturing landscape.
The Index, released by Dezan Shira & Associates, evaluates manufacturing competitiveness across eight core pillars and 43 sub-parameters, including infrastructure, labour, logistics, regulatory environment, and access to markets.
India trails key Asian manufacturing hubs
In its third edition, the AMI places India behind several Asian peers that have moved faster in improving manufacturing readiness and execution. Malaysia emerged as the second-ranked economy in 2026, marking its first time at that position, while Vietnam slipped to third after holding the second spot in the previous year.
Among developed economies, Singapore climbed one rank to fourth place, overtaking South Korea, which dropped to fifth. These movements underline intensifying competition among Asian manufacturing destinations as countries race to attract global supply chains.
Regional competition heats up
According to the report, shifts in rankings reflect how quickly countries are adapting to changing global manufacturing trends, including supply-chain diversification, cost efficiency, regulatory clarity, and industrial ecosystem depth.
While India continues to benefit from a large domestic market, improving infrastructure, and strong policy intent, the Index suggests that execution gaps, logistics efficiency, and ease of doing business remain areas requiring sustained improvement to match top-tier Asian peers.
Manufacturing push critical for India’s growth ambitions
Manufacturing remains a key pillar of India’s long-term economic strategy, with initiatives such as Make in India, production-linked incentive (PLI) schemes, and supply-chain localisation aimed at boosting output and employment.
However, the AMI 2026 ranking indicates that incremental progress may not be sufficient. Analysts note that India will need faster implementation, deeper industrial reforms, and stronger integration with global value chains to climb higher in future editions of the Index.
Outlook
As global manufacturers reassess sourcing strategies amid geopolitical and economic uncertainty, Asia remains at the centre of the manufacturing shift. For India, improving its standing beyond sixth place will depend on translating policy vision into on-ground competitiveness, particularly in logistics, regulatory efficiency, and industrial scale.
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