Indian Manufacturers Lead in AI Adoption but Lag in Innovation Compared to China
Indian Manufacturers Lead in AI Adoption but Lag in Innovation Compared to China
IN · Published Aug 17, 2026
A recent PwC study titled 'Rewriting the rules: The next chapter of Indian industrial manufacturing' highlights that Indian manufacturers are heavily investing in artificial intelligence (AI) compared to global peers.
However, the study reveals a significant gap in innovation, with only 16% of Indian manufacturers focusing on product leadership, compared to 63% in China.

Impact & Risks

The lack of focus on innovation could limit the global competitiveness of Indian manufacturers, keeping them in the low-value segment of the industrial value chain. This could hinder India's ambition to become a $7.5 trillion manufacturing economy by 2047. Additionally, the dependency on external intellectual property and platforms may restrict revenue growth and leave Indian manufacturers vulnerable to competition from countries like China, which are advancing in product innovation and differentiation.

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