The Centre is preparing a comprehensive strategy to reduce India's dependence on imports as part of efforts to strengthen domestic manufacturing, secure supply chains and shield the economy from growing geopolitical uncertainties. According to officials familiar with the matter, the Prime Minister's Office has directed key ministries to identify products with high import dependence that can be manufactured domestically. The initiative forms part of the government's broader push to build self-reliance in critical sectors and reduce external vulnerabilities.

Officials said the Ministry of Commerce and Industry is preparing a list of more than 100 products across sectors such as electronics, chemicals, pharmaceuticals, fertilisers, semiconductors, automobiles and machinery that could be produced on a larger scale within the country. The government is also considering subsidies and other incentives to encourage domestic manufacturing and attract investment. However, discussions remain ongoing, and a final policy framework has not yet been approved.

The latest move follows the Union Cabinet's recent approval of an additional Rs 1.9 trillion support package aimed at expanding semiconductor and smartphone manufacturing in India. The government has also approved measures to boost domestic fertiliser production following supply disruptions linked to the closure of the Strait of Hormuz. These initiatives are intended to strengthen India's industrial base while reducing exposure to external supply shocks.

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India's manufacturing sector remains heavily dependent on imported raw materials and intermediate goods, particularly from China. Recent disruptions in global supply chains, rising geopolitical tensions and higher energy costs have highlighted the risks associated with such dependence. Economists believe that strengthening domestic production could help reduce the trade deficit, conserve foreign exchange reserves and position India as an alternative global manufacturing hub, although they note that achieving competitive scale will be essential for long-term success.

According to officials, a task force led by Principal Secretary to the Prime Minister Shaktikanta Das is preparing an import substitution roadmap, with members of the Prime Minister's Economic Advisory Council also contributing to the exercise. The government is exploring options including expanded manufacturing incentives for private and foreign investors, joint ventures involving public sector enterprises and reforms to export promotion schemes that encourage greater use of locally manufactured components.

Officials acknowledged that imports of crude oil, gold and critical minerals cannot be easily replaced in the near term, but believe significant opportunities exist to reduce dependence on products such as fertilisers, edible oils and pulses through domestic production and agricultural reforms. In sectors where immediate substitution is not feasible, the government is expected to pursue a phased strategy to gradually build local manufacturing capacity. The proposed measures reflect the Centre's broader objective of enhancing economic resilience while reducing India's vulnerability to global supply chain disruptions and geopolitical risks.

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