Davos 2026: India must speed up reforms to boost manufacturing potential, says CII president Rajiv Memani

• Accelerating reforms can boost India's manufacturing competitiveness
• India imports $500–$550 billion in goods yearly; proactive policies needed
• Legal reforms and direct subsidies urged to raise manufacturing's GDP share

Did our AI summary help?

India’s manufacturing sector could unlock far greater potential if the pace of reforms is accelerated, says Rajiv Memani, chairman, India Region & Emerging Markets Committee at EY and president of Confederation of Indian Industry (CII).

Speaking to Moneycontrol’s Chandra R Srikanth, Memani said the government has laid a solid foundation but more needs to be done to make manufacturing more competitive.

“Land reforms are in place, but when it comes to manufacturing, ease of doing business has to be further accelerated. We should also look at privatising state electricity boards and move away from cross-subsidisation. Any subsidy for consumers should be direct rather than impacting commercial operations,” Memani said.

He highlighted India’s reliance on imports, noting that the country still imports $500–$550 billion worth of goods annually. “We need a clear strategy to replace at least part of these imports over the next two to three years, backed by the right policies, incentives, and frameworks. New sectors like data centres will see huge capital inflows, which could increase import dependence. Proactive domestic manufacturing is key,” he said.

Memani also stressed legal reforms to reduce litigation in manufacturing, including the introduction of limitation periods in laws that currently lack them. “The government’s intent is fantastic, but to significantly raise manufacturing’s share of GDP-whether we reach 25 percent or not-we must do much more,” he said.

On the global business outlook, he said that current geopolitical tensions are impacting supply chains and trading partners. “People want to develop supply chains with greater predictability and stronger partnerships between countries. Sudden changes in tariffs, for example, create uncertainty, but everyone is hoping these issues will get resolved,” he said.

Despite uncertainties, Memani said sentiment around India remains strong. “Growth numbers are impressive, especially when compared with other major economies, and macroeconomic stability is visible to everyone. Trade relationships with Australia, the Middle East, and Europe are strengthening, and significant investments are happening in AI,” he said.

He added that trade deals are more than just about tariffs-they build stronger platforms and relationships between countries. “If India has to meet its true potential, reforms are important. Anything that creates a platform for greater manufacturing in India will be critical,” Memani said.