 "2025 saw India’s manufacturing push gaining momentum amid China’s slowdown")
Each economy has a story carved out of its own, India has its own core and traditional rapidly unfolding trajectory. The manufacturing sector gained significant momentum in 2025, fueled by policy incentives, global supply chains which emerged as a central pillar of the nation’s growth model.
The Index of Industrial Production (IIP), which tracks the volume of output across manufacturing, mining, and electricity, is a snapshot of how industry is performing and its contribution to GDP growth.
Accounted in July 2025, the IIP recorded a growth of about 3.5 per cent year-on-year, rising significantly from 1.5 per cent in June 2025.
China faces prolonged contradiction on the global stage amid weak demand and trade tensions. Recent political tensions with the US, Taiwan, and Japan has put China in a diplomatic conflict leading to the slowdown of the economy.
The official PMI of China stayed below 50 for eight straight months by November 2025, marking the long contradiction streak of nearly a decade, with October at 49 and output dipping into negative territory.
The domestic demand also weakened, retail sales growth slowed for five months and US trade tensions exacerbated the slump despite a recent Trump-Xi agreement easing tariff tensions.
Indian growth
India has recently moved past Japan to become the fourth largest economy in nominal GDP terms. Performing and acting well on the global stage is categorically much more for India, as it is ready to overtake Germany in the coming years and become the third largest economy after the US and China.
India’s growth story is increasingly powered by the hum of modern factory floors. From the Electronics Manufacturing Cluster (EMC) in Pune, to laptop assembly line in Chennai, it reflects the spread of industrial activity across regions.
Quick Reads
View AllBehind the scenes, policies like PLI, National Manufacturing Mission and others are turning these hubs into high-performance nodes.
China’s slowdown
China’s economic slowdown in 2025 stems from the structural and diplomatic weakness like a real estate crisis, demographic shifts, and weak domestic consumption, compounded by external trade and business.
The policies built up shows the hesitancy on a global stage. The cultural slowdown and territorial claim over Taiwan as its own territory has positioned it into a problematic hurdle.
The US imposed additional tariffs on China peaking at 145 per cent before partial truces, disrupted exports and the supply chains, hitting the manufacturing PMI. The superiority over the rare earth minerals helped China to gain some significance but also posed significant threats.
India-China relations
One of the biggest challenges for India in 2025 was managing its approach towards China. As in the past relations between India and China did not remain prosperous. In April, China halted the supply of critical rare earth metals, essential for chips, weapons, electric vehicles and several other appliances.
Without interventional, the disruption threatened to derail India’s ambitious electric vehicle adoption plans.
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