Top 10 Fastest Growing Business Industries in India 2024
In today’s investment climate, which is very dynamic and always changing, it is important to identify industries that are emerging with a potential for significant growth. Investors can make informed decisions by understanding market trends and analyzing key statistics. This article examines the fastest growing industries in India that will flourish in 2024.
The top 10 fastest growing industries in India 2024
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Electric Vehicles (EV)
Electric vehicles (EVs) is one of the most rapidly growing sectors in India. The transition to electric mobility is gaining momentum globally and India is no exception. The Indian government has set ambitious targets and implemented a range of incentives to promote electric vehicle adoption.
Market Overview
According to industry reports, the Indian electric vehicle market size was valued at US$ 1.45 billion in 2021, and it is projected to reach a staggering US$ 113.99 billion by 2029, exhibiting a remarkable CAGR of 66.52% during the forecast period.This far-reaching projection comes despite the challenges posed by Covid-19 pandemic as the country’s EV market grew up by 11.34% in 2020 compared to last year.
Segments
The segment-wise breakup of the Indian electric vehicle market reveals that two-wheelers constituted approximately 90% of all EV sales made during FY21.Three-wheelers and four-wheelers accounted for slightly over nine percent and one percent respectively. It should be noted that each segment has different sizes as well as rates of growth with two wheelers set for a CAGR of about 67% between 2022-29 while three wheelers shall experience a growth rate amounting to around 64% and four wheels rotating on an average scale at about CAGR63% within this time frame.
Growth Drivers
Several factors contribute to the growth of the electric vehicle market in India.The introduction of policies like Faster Adoption and Manufacturing of Hybrid & Electric Vehicles (FAME) Scheme along with National Electric Mobility Mission Plan (NEMMP) has significantly boosted the EV industry. Moreover, there are reduced Goods and Services Tax (GST) on electric vehicles, income tax deductions, state level subsidies and incentives that have also propelled the uptake of electric cars.
Investment Opportunities
This is a sector where investment can be extremely lucrative as demand for clean and sustainable transportations solutions continues to rise.Companies involved in electric vehicle manufacturing, battery technology, charging infrastructure and other related services stand to benefit from this growth. Additionally, the Indian government’s drive towards electric mobility coupled with increased consumer awareness about environmental issues make EVs an attractive sector for investment.
2. Healthcare and Insurance
The healthcare and insurance sectors in India have experienced tremendous growth over the past years.According to IBEF projections, by 2022, the Indian healthcare market would reach a remarkable US$372 billion growing at a CAGR of 22% between 2016-2022.The Health insurance market too is projected to hit USD 94 billion by 2025 at a CAGR of around 20% during the period from 2020-25. This growth is driven by increasing health consciousness among people along with rising expenditure on healthcare and greater emphasis on comprehensive insurance coverage.
Market Overview
Moreover, there has been increasing number of health insurance policies being issued.From FY20 when there were about 48.9 million policies issued to FY21 when they reached approximately 60.7 million.This sharp increase in policy issuance demonstrates an improved understanding of health insurance by Indians.As these healthcare and insurance industries continue expanding, they offer great opportunities for investments aimed at long-term prospects for growth.
Growth Drivers
The healthcare sector is growing because of factors such as increased instances of chronic diseases, an aging population and more attention on preventive care. This growth has also been fueled by technological advancements and government programs like Ayushman Bharat. Also responsible for the remarkable increase of the industry are higher disposable incomes and improved insurance coverage.
Investment Opportunities
Stable and long-term returns can be obtained by investing in the sectors that combine healthcare with insurance. Hospital management companies, medical services providers, pharmaceuticals, medical devices manufacturers and health insurance companies are among those that stand to gain from the expanding demand for health care services. As a result, healthcare and insurance stocks have become attractive investment vehicles for those who want to participate in increasing demand for quality healthcare or comprehensive insurance coverage.
3. Renewable energy
Renewable energy is another of India’s fastest growing sectors where investors may also consider in 2024. By March 2021, the country had made significant progress in renewable energy with a capacity of 95.66 GW. The total capacity includes, Solar power (38.79 GW), wind power (39.24 GW), bio-power (10.31 GW), and small hydropower (4.7 GW). Government has set an ambitious target of installing 175 GW of renewable energy capacity by 2022, which will include solar contributing 100 GW, wind contributing 60GW, bio-power contributing10GW and small hydropower contributing5GW.
Market Overview
The Indian renewable energy sector offers great potential for growth and investment opportunities . As the nation aims to cut its reliance on non-renewable fuels and embrace sustainable sources of power , the opportunities for solar ,wind and other alternative projects are anticipated to grow . Investing in the renewable energy sector can provide attractive returns as well as contribute towards a greener future through the use of favorable government policies such as incentives.
Growth Drivers
A number of factors influence the growth rates experienced within the renewable energy sector in India . These factors include favorable government policies , technological advancements that continue reducing costs for renewable energy technologies , and increasing awareness about environmental issues . The increased focus of government on carbon emissions reduction as well as promotion of sustainable sources of energy has spurred further growth in this sector.
Investment Opportunities
Significant growth prospects can be realized through investments in renewable projects including those involving solar, wind, bio-power, and small hydropower. Companies involved in renewable energy production, distribution and technology development stand to gain from rising demand for green power solutions. Additionally , support from governments on renewables together with increasing awareness on environmental sustainability make this a promising opportunity.
4. Information Technology (IT)
The Indian IT industry has been a significant contributor to economic growth and employment in the country. Despite the challenges experienced due to the COVID-19 pandemic, the industry’s revenue was US$ 194 billion in FY 21 with a YoY growth of 2.3%. The share of industry’s export revenues as a percentage of India’s total merchandise exports was approximately 8% amounting to nearly $150 bn during FY21. As per March 2021 data, about 4.47 million employees are working in IT which is considered as one of themajor sectors contributing significantly to India’s economy.
Market Overview
The industry has shown resilience and adaptability making it an attractive investment sector . With its immense capabilities for technology advancements and outsourcing among others, India has positioned itself as a global IT hub because of its young skilled human resources. Indian IT industry also benefits from the rise of new technologies like digital transformation , cloud computing , Artificial Intelligence (AI) , etc., which further enhances its potential growth . With continuous investments by companies globally on technology solutions and digital infrastructure, demand for IT services remains strong.
Growth Drivers
Factors such as digital transformation, increasing adoption of cloud computing, advancements in artificial intelligence and machine learning, and the rising demand for cybersecurity solutions are driving the growth of the IT sector in India. The government having realized that technology can be used to achieve efficiency across various industries is promoting digitization hence this boost in IT sector.
Investment Opportunities
Acquiring a stake in the Indian IT industry can be a source of growth that is long-term and profitability. Entities developing software, offering IT advice, focusing on cyber security or those involved in digital transformation are at an advantage due to the increased dependence on technology across various industries. Besides, there is favourable environment for IT investments as government has been promoting digitalization and adaptation to new technologies.
5. FMCG
Indian fast moving consumer goods (FMCG) sector has been witnessing stable growth and is among the booming sectors across India. According to IBEF, the Indian FMCG market is expected to hit US$ 220 billion by 2025 with a CAGR of 9.4% for 2020-2025. The Rural FMCG market too is set for a substantial growth; it’s projected to reach US$ 100 billion by 2025 at a CAGR of 10.6% between 2019 and 2025, respectively. The online FMCG market is also anticipated for rapid expansion reaching US$18 billion in value by year end, with a CAGR of about 31% by growth during the period of time from now till year-end.
Market Overview
There are several factors that support the growth of the FMCG sector in India. An increased disposable income has led to urbanization which has changed consumer preferences towards e-commerce platforms creating demand for products in this industry. Additionally, this industry survives even in uncertainty making it an investment option preferred by most people.
Growth Drivers
Factors such as increasing urbanization, rising disposable incomes, changing customer preferences and growing number of e-commerce platforms have propelled the pace of development within India’s FMCG sector upwards. Resilience exhibited during unstable times alongside increasing demand for personal care and household items are other things spurring its growth.
Investment Opportunities
Investments into well-established FMCG companies or exploration into niche segments can help investors tap from India’s expanding consumer market. It will be important for firms focusing on innovation, distribution efficiency and sustainability to excel in this competitive environment. Moreover, there is huge investment opportunity due to high demand for these products as well as tremendous growths on e-commerce platform in this sector.
6. Infrastructure
The infrastructure industry offers significant investment prospects due to ambitious national plans aimed at developing and modernizing the country. According to IBEF, the Indian infrastructure sector is expected to draw in about $1.4 trillion worth of investments between 2019-2023. The output of the sector by 2025 is projected at a CAGR of around 7.6% from where it was in the year 2016. Government initiatives like Smart Cities Mission, National Infrastructure Pipeline (NIP) and Bharatmala Pariyojana project aim at improving country’s infrastructure and creating investment environment conducive for put.
Market Overview
The government’s focus on developing roads, airports, railways and smart cities has opened up numerous opportunities for companies as well as investors within this space. Population growth, urbanization and increased demand for proper infrastructural facilities are among the forces behind its expansion further into new areas. By investing in infrastructure projects, one can provide high returns on investment and thereby fuel economic growth and development in India.
Growth Drivers
Among other factors contributed about increasing urbanisation, growing population numbers, government initiatives also play part in driving infrastructure sector growth in India with quality dimensions being demanded by people today over time. A lot more chances have been created through governments attention given to roads as well as railways including airport alongside smart cities when it comes to companies or individuals willing to take advantage of existing opportunities within constructions.
Investment Opportunities
Long term growths with stability can be achieved through investing in such project types as roads, airports railways or even smart cities that could be providing an attractive return of over a number of years henceforth. Construction players; engineers; project managers; developers; builders; financiers of physical assets are some firms best suited due increasing demand for quality infrastructures should derive huge benefits relating thereto accordingly unlike most others due majorly their business nature itself which is quite difficult depending so mainly upon what people who want these things said would enable them get any financing support they require because as per provision no investor should suffer any loss whatsoever due only being organized better than its competitors. Additionally, government’s initiative and focus on infrastructure devopment provide an opportunity for investors to invest in this sector.
7. Fintech
The financial technology industry has seen rapid growth in India in recent years, changing how the delivery and consumption of financial services are done. The Indian fintech market is projected to reach US$ 150 billion by 2025, at a CAGR of 22%, from 2020-2025, as per industry reports. This remarkable progress of fintech has been accelerated by use of digital payments, increasing smartphone penetration and positive policy response from national governments.
Market Overview
Fintech comprises multiple segments such as digital payments, lending, insurance technology, wealth management and blockchain among others. The Indian fintech ecosystem has emerged as a global hub attracting significant investments and promoting innovation. Digitization of wallets, UPI (Unified Payments Interface) and peer-to-peer lending platforms have radically transformed the financial sector making it more accessible to millions of people in India.
Growth Drivers
Technological advancements like rising smartphone usage rates encourage digital payment adoption while favourable policies towards this sector have also boosted the growth rate for fintech in India. Other factors such as convenience, accessibility and financial inclusion contribute to its rising trend.
Investment Opportunities
In view of exponential increases that are possible with investment in fintech businesses; high returns can be guaranteed. FinTech is broken into segments such as Digital Payments, Lending Platforms, Insurance Technology and Wealth Management Services among other key areas. Therefore, investors should consider leveraging on a digitally evolving Indian Financial Services market with a growing appetite for new solutions.
8. E-commerce
India’s e-commerce industry has grown tremendously over time becoming one of the fastest-growing sectors in the country today. The Indian e-commerce market will hit USD 200 bn by 2026 according to industry reports and grow at a CAGR of about 27% within the period spanning from 2021 up until 2026.” In addition to internet penetration being high Internet penetration is getting higher especially due to the large number of smartphones now in use and changes in consumer behavior.
Market Overview
E-commerce comprises various types of online retail, marketplaces, digital payments, and logistics. The face of retailing has been drastically changed by online shopping, convenient ways to pay for goods and quick delivery services. Flipkart, Amazon, Myntra are few examples of e-commerce platforms that are well-known across India having a wide range assortment on products and services offered.
Growth Drivers
The growth of E-Commerce is driven by factors like growing internet penetration rates; increasing usage of smartphones; changing consumer behavior which is making it easier to shop online. There are other reasons such as providing a broad selection of products and services with efficient methods for delivering those items right at your door-step without any hassle as an example.
Investment Opportunities
Therefore, investments in e-commerce companies have great potential due to the surge in numbers choosing online shopping over traditional brick-and-mortar ones. E-retailers, digital payment providers, logistics operators and technology enablers are some companies positioned to take advantage of this increased business activity within the e-commerce sector. In addition, popularity around social commerce and the rise in personalized customer experiences offers many investment opportunities within e-commerce industry as well.
9. Pharmaceuticals
The Indian pharmaceutical industry is one of the largest globally and it produces generics and active pharmaceutical ingredients (APIs). India’s pharmaceutical market, according to IBEF study, would touch over USD 130 billion by 2030 growing at a CAGR of 12% during 2020-2030. The COVID-19 pandemic was countered by the industry’s endurance in ensuring that essential drugs and vaccines were available.
Market Overview
Globally, India is known for producing about 20% of generic drugs according to DCGI. Moreover, India’s Pharma Industry has had great presence in exporting its products with exports amounting to USD 24.4 bn in FY21. The Indian pharmaceutical sector is driven by several factors which include increasing prevalence of chronic diseases, rising healthcare expenditure and growing demand for affordable medicines.
Growth Drivers
India’s pharma sector growth is driven by factors such as increased occurrence of chronic diseases; investment on health care services; increased demand for low-cost medicine; manufacture of generics among others. On top of this, strong export capabilities in this industry that ensure availability of essential medicines and vaccines also contribute to this growth.
Investment Opportunities
Pharmaceutical industry investments are often rewarded with stable returns and long-term growth prospects. Companies engaged in generic drugs production, APIs manufacturing, biotech or research & development are positioned to take advantage of the demand surge in healthcare solutions. In addition, the focus on innovation coupled with quality and affordability within the industry makes attractive opportunities for investments within pharmaceutical companies.
10. Edtech
In India edtech has witnessed an unprecedented boom leading to a revolution in education through technology based learning processes (Indian EdTech Market By Value). As per reports from the industry sources edtech market size in India is expected to reach $30bn by 2032 at a CAGR of 33% during 2020-2032 period. Online learning, digital content and personalized education solutions have been the major drivers for growth in the edtech sector.
Market Overview
Digital learning platforms, educational apps, learning management systems and digital content providers are different segments of edtech. The advent of e-learning as well as virtual classrooms and interactive educational tools has changed how education is given and consumed. Companies like Byju’s, Unacademy and Vedantu have attracted a large number of students across India with their wide range of courses available for all grade levels with personalized curriculums.
Growth Drivers
Factors such as increasing adoption of online learning, digital content, personalised education solutions and demand for skill development are driving the growth of ed tech market in India. Furthermore, this sector’s ability to offer affordable, accessible and flexible modes of learning has also led to its increased development.
Investment Opportunities
On top of edtech industry’s rapid expansion coupled with the growing demand for online educational solutions; investing in firms undertaking these services can be very lucrative. Ed tech industry will expand to include companies which provide online learning platforms; create digital contents; develop education technology software; or run various skills enhancement programmes. Moreover, emphasis on lifelong learning besides reskilling and upskilling presents interesting avenues for investments within this sphere.
India’s ever-changing economy provides a number of investment opportunities in many areas. Investors can make knowledgeable choices and take advantage of upcoming businesses by monitoring the most recent market trends and growth prospects. The sectors discussed in this article, are some of the rapidly growing industries in India by 2024, offering lucrative long-term growth prospects to interested parties.
