India has some major import dependencies that include energy, electronics, and critical minerals. While India has a large agricultural sector, it also imports significant amounts of agricultural commodities like pulses. India needs certain fermentation-based active pharmaceutical ingredients (APIs). Economically, China is the largest supplier of imports to India, followed by countries like Russia and the United Arab Emirates (UAE), creating a substantial trade deficit. China remained irreplaceable across manufacturing, lithium, APIs, and electronics. Japan and South Korea led in robotics and heavy engineering equipment. Time to look at dependencies and India’s strategies.
Energy
India remains the world’s third-largest crude oil importer with a dependency rate of nearly 87 percent in recent years. India imports approximately 4.7–5 million barrels of crude every day. This high reliance makes the economy vulnerable to global price fluctuations. India has a 45.3 percent import dependence on natural gas. Russia surged in crude oil after 2022. In the last five years, crude oil imports from Russia were 25–30 percent, Iraq 22–24 percent, Saudi Arabia 17–19 percent, United Arab Emirates (UAE) 8–10 percent, and USA 6–8 percent. In the last three years, Russia’s share increased to 35–37 percent, emerging as the dominant supplier. It offered discounted Urals crude. Iraq remains India’s most consistent long-term supplier with reliable quality Basrah crude. Russian Urals and Iraqi Basrah are likely to be the main suppliers to India’s ‘Jewel of the Desert’ refinery being set up by HPCL Rajasthan Refinery Ltd. (HRRL), an integrated petrochemical complex with a capacity of 9 million mt/year currently under construction. Saudi Arabia remains a historical partner with significant investments in Indian refineries by Aramco. UAE is a growing supplier with energy storage partnerships and proximity advantages. USA supplies lighter, sweeter crude for blending with heavier Middle Eastern grades.
India’s energy strategy focuses on a massive transition to clean energy, with a target of 500 GW of non-fossil fuel capacity by 2030, while also ensuring energy security through diversification, increased domestic production, and technological advancement. Key elements include promoting solar and wind power, growing green hydrogen, increasing domestic oil and gas exploration, expanding infrastructure, and increasing the use of biofuels like ethanol. The strategy aims to balance energy availability, affordability, and sustainability while reducing import dependence.
As of June 2025, this capacity reached 235.7 GW, or 49 percent of the total installed capacity. Solar energy is a dominant source of growth, with initiatives like the PM-KUSUM Scheme and the PM Surya Ghar Muft Bijli Yojana encouraging rooftop solar adoption. Wind energy is also expanding, and India is targeting significant growth in hydropower and bioenergy, including the production of compressed biogas. The National Green Hydrogen Mission aims for 5 MMT of production by 2030, with significant investment and export potential.
Energy security and traditional sources strategy includes a strong push to increase domestic exploration for oil and gas. Efforts are underway to increase the use of natural gas, supported by a growing LNG terminal infrastructure, and by increasing domestic production through methods like coal gasification and other renewable sources.
India’s policy reforms promote energy transition. Production-Linked Incentive (PLI) schemes for batteries and the Renewable Purchase Obligation (RPO). Energy infrastructure expansion includes expanding the gas pipeline network and building new LNG import terminals. Blending 20 percent ethanol into petrol by end 2025.
Electronics
The country imports components like printed circuit boards (PCBs) for smartphones and computers, transistors, diodes, and semiconductors, as well as other electrical machinery for industrial use. China and Hong Kong account for over 52 percent of India’s electronics imports, highlighting significant dependency on Chinese supply chains. Vietnam 10–12 percent, South Korea 8–10 percent, and Taiwan 5–6 percent are the others. India’s electronics imports reached $89.8 billion in 2023–24, with electronic components worth $34.4 billion, making it the fifth-largest import commodity. Hong Kong is essentially the re-export hub for Chinese electronic goods. South Korea is a significant source for semiconductors, displays, and advanced electronics. Taiwan for advanced electronics and semiconductor components.
India’s electronics strategy focuses on becoming a global manufacturing hub through initiatives like PLI, the National Policy on Electronics 2019, and the Electronics Component Manufacturing Scheme (ECMS). These programs aim to boost domestic production and exports by encouraging investment, promoting indigenous production, developing manufacturing clusters, and reducing import dependency. The country also emphasizes the Make in India and Digital India campaigns and is building its semiconductor ecosystem to achieve ambitious targets of $300 billion in manufacturing and $120 billion in exports by FY26. The government provides financial assistance to state governments to set up Electronics Manufacturing Clusters (EMCs) and Common Facility Centres (CFCs) to offer a package of services to manufacturers. India is focusing on skill-based training to meet the increasing demand for talent in the sector.
India is actively developing its semiconductor capabilities by approving major projects to design and produce micro-components and chips, which are foundational to modern electronics. Target is to increase India’s share in global electronics exports to 4–5 percent by 2030, and reach $500 billion in electronics production by 2030. India has made it easier for foreign companies to establish production facilities in the country.
Lithium Ion Batteries
India’s lithium-ion battery imports reached $2.0 billion in 2023. 70–75 percent Lithium Ion (Li-ion) batteries for India in the last five years came from China. Vietnam 8–10 percent, South Korea 6–8 percent, Japan 3–4 percent, and USA 2–3 percent were others. India is growing suppliers as companies diversify away from China. South Korea is a source for advanced battery technology and high-performance cells, and USA for advanced batteries and specialized applications.
Imported batteries quadrupled over a five-year period. The rapid growth is fuelled by the increasing demand for electric vehicles (EVs) and the expansion of the renewable energy sector, particularly solar power plants. India is making strides to reduce its dependence on imported lithium-ion batteries, and is expected to drop to about 20 percent by FY27. To reduce this dependency, India is promoting domestic manufacturing through the PLI scheme for advanced chemistry cells. The government has also introduced import duties on finished products while lowering them on raw materials to encourage local manufacturing. India is also dependent on imports for key raw materials like lithium, and government initiatives are in place to address this, such as the Critical Minerals Mission and trade duty exemptions on crucial minerals.
Medical Devices
India continues to rely heavily on medical device imports, with the country spending over $25 billion on electro-medical and surgical instruments between FY2020–21 and FY2024–25. While the market is expected to grow to over $20 billion in FY25, imports still account for 70–80 percent of the medical devices, primarily from countries like the US, China, and Germany.
India’s strategy for medical devices focuses on the National Medical Devices Policy, 2023, which aims to grow the sector to $50 billion by 2030 through a patient-centric approach. Key pillars include regulatory streamlining via a single-window system, incentivizing domestic manufacturing through PLI, fostering innovation and R&D, and improving infrastructure. Enhance the role of Indian standards, such as the Bureau of Indian Standards (BIS). Create a coherent pricing regulation framework. Implement mandatory unique device identification (UDI) and transition from voluntary to mandatory import licensing. Promote the establishment of medical device parks and common facility clusters. Attract both domestic and international investment in the sector. Encourage ethical marketing practices through initiatives like the Uniform Code for Medical Device Marketing Practices (UCMDMP).
Fertilizers
India’s fertilizer imports were around $8.29 billion in 2024–25, down from $8.92 billion the year before. Russia 21–23 percent, China 13–15 percent, Oman 12–13 percent, Saudi Arabia 10–11 percent, and Morocco 9–10 percent were the main sources in the last five years. Russia was the largest supplier, particularly for urea and complex fertilizers. Saudi Arabia was the major phosphate supplier. Oman was a significant source for urea and phosphates. China supplies DAP and specialty fertilizers, though imports dropped 61 percent in 2024–25 due to export restrictions. And Morocco is a great source for phosphate.
India’s fertilizer strategy focuses on promoting balanced nutrient application and sustainable practices to reduce reliance on imported chemical fertilizers like urea and DAP. Key initiatives include the promotion of nano urea and neem-coated urea, the “One Nation One Fertilizer” scheme (subsidized fertilizers under a single brand name, “Bharat”), and programs like PM-PRANAM, which incentivizes states to adopt organic alternatives. The strategy also involves improving efficiency through new technologies like drones, and encouraging a shift towards a more diverse range of fertilizers beyond nitrogen-heavy options. The use of Direct Benefit Transfer (DBT) for subsidies is being expanded to improve transparency and efficiency.
Agricultural commodities
Import dependency for pulses has risen significantly in recent years. India’s strategy for pulses aims to achieve self-sufficiency by launching the Mission for Aatmanirbharta in Pulses (2025–26 to 2030–31), with a budget of ₹11,440 crore. The strategy involves increasing production to 350 lakh tonnes by 2030–31, expanding cultivation to 310 lakh hectares, and guaranteeing 100 percent procurement of Tur, Urad, and Masoor at MSP for four years. Key initiatives include distributing free and certified seeds, promoting climate-resilient practices, and developing post-harvest infrastructure like processing units. India’s average pulse productivity is approximately 0.74 to 0.89 tonnes per hectare, which is below the global average. Target is to raise productivity to 1.13 tonnes/ha by 2030–31. It will benefit nearly 2 crore farmers. Promote best practices and technologies for balanced fertilizer use, plant protection, and improved mechanization, supported by institutions like the Indian Council of Agricultural Research (ICAR). Support the development of post-harvest infrastructure, including setting up 1,000 processing units with a maximum subsidy of ₹25 lakhs for each unit.
India imports large quantities of animal/vegetable fats and oils. India’s vegetable oil strategy focuses on achieving self-sufficiency through the National Mission on Edible Oils (NMEO) for Oilseeds and Oil Palm. Key objectives include increasing domestic oilseed and oil palm production, promoting crop diversification and intercropping, and improving productivity through better irrigation and modern techniques. The government also supports farmers through MSP. Increase primary oilseed production from current 39 million tonnes to 69.7 million tonnes by 2030–31. Expand oilseed cultivation by an additional 40 lakh hectares by using fallow lands and promoting intercropping. Increase domestic edible oil production to 25.45 million tonnes by 2030–31, covering 72 percent of the projected demand. Encourage farmers to switch to high-yielding oilseeds like groundnut, soybean, and sunflower, as well as promote intercropping.
Modernize processing infrastructure and utilize technology to improve seed quality and crop yields. Adjust import duties on crude and refined oils to protect domestic farmers and manage food inflation. Expand oil palm cultivation, particularly in the northeast and Andaman and Nicobar Islands.
Pharmaceuticals
India’s pharmaceutical industry, despite being the “pharmacy of the world,” heavily depends on certain fermentation-based API imports which are key ingredients for antibiotics and vitamins. Main sources in the last five years were China 68–72 percent, European Union (EU) 9–11 percent, USA 5–6 percent, Japan 4–5 percent, and Singapore 2–3 percent. China’s share was $3.6 billion in 2023–24, and thus dominated bulk drugs and intermediates supplies. European Union supplies quality patented and innovative APIs. Japan is a source of specialty APIs and advanced pharmaceutical ingredients. United States supplies innovator APIs and patented molecules. Singapore is the trading hub for pharmaceutical intermediates.
India’s pharmaceutical strategy focuses on strengthening R&D and innovation to move beyond generics, improving domestic manufacturing of APIs and Key Starting Materials (KSMs) to reduce import dependence, and expanding global market share by focusing on value-added products like biologics and biosimilars. Key government initiatives include the PLI scheme, collaborations to foster innovation, and investing in infrastructure and talent. Reduce dependence on imports, particularly from China, for APIs and KSMs. Establish dedicated API parks and upgrade existing facilities to meet global standards. The overarching goal is to transform India into a global pharmaceutical powerhouse by 2047, achieving milestones like reaching $130 billion in pharmaceutical sector revenue by 2030 and $450 billion by 2047.
Heavy Engineering Equipment
Heavy engineering equipment is required for tunnelling, roads, railways, and shipbuilding. India currently imports approximately 50 percent of construction and heavy engineering equipment by value. Imports percentage in the last five years was China 32–34 percent, Japan 20–22 percent, Germany 15–17 percent, South Korea 10–12 percent, and USA 8–9 percent. China mostly supplies tunnel boring machines (TBMs), large cranes, and construction equipment. India imports from Japan advanced machinery, precision equipment, and robotics for construction. Germany is the source for specialty steels, high-tech components, and advanced electronic control units. Imports from South Korea include hydraulics, undercarriages, and electronic systems, and USA is the source for specialized rigs and advanced construction equipment.
Based on India’s ambitious infrastructure development agenda, a robust strategy for heavy engineering and tunnelling equipment would focus on localized manufacturing, advanced technology adoption, and addressing geological complexities. National Infrastructure Pipeline (NIP) is meant to align manufacturing and capacity, which includes a massive outlay for projects in transportation, urban infrastructure, and energy.
PM GatiShakti Plan capitalizes on this master plan that integrates various ministries to ensure faster, more coordinated execution of infrastructure projects, including railways, roads, and waterways. National Manufacturing Policy is also meant to grow manufacturing capabilities, bolster domestic demand, and compete with foreign players.
Growing metro (third largest globally) and High-Speed Rail network, dedicated freight corridors, the demand for tunnel boring machines (TBMs) for urban projects will increase significantly. Invest in R&D and technology to counter competition from foreign manufacturers, particularly from China and Korea. Leverage public-private partnerships (PPPs) and Infrastructure Investment Trusts (InvITs) for project financing to address the high capital requirements of the sector. For projects in the difficult Himalayan region, utilize methods like the New Austrian Tunnelling Method (NATM), which can adapt to unpredictable ground conditions.
Robotics
India imported 1,665 robotic machine shipments during October 2023–September 2024, marking 32 percent growth year-on-year. Robotics imports to India in the last five years, China accounted for 45–50 percent, and was the largest supplier of robotic machines and automation equipment. South Korea 15–18 percent, Japan 10–12 percent, Germany 7–9 percent, and Taiwan 5–6 percent were next. Specifically, for industrial robots, Japan leads with 56–60 percent. South Korea is the source for industrial automation and advanced robotics, and Vietnam for electronics assembly robots and lower-cost automation. Japan supplies precision robotics and high-quality automation systems, and Taiwan, electronic components and robotic subsystems.
India’s industrial robot market is rapidly growing, with a 59 percent increase in installations in 2023, reaching 8,510 units and placing it seventh globally. The sector includes both global giants like ABB, FANUC, KUKA, and Yaskawa, as well as numerous Indian companies developing indigenous solutions for applications ranging from automotive manufacturing to warehouse automation and sanitation. The automotive industry accounts for 42 percent of installations. Japan was the lead contributor for this sector.
India’s robotics strategy is a national plan to become a global leader in robotics by 2030, focusing on innovation, development, and adoption across key sectors like manufacturing, healthcare, agriculture, and national security. The strategy includes establishing a Robotics Innovation Unit (RIU) as part of the IndiaAI Mission to nurture the whole ecosystem.
Commercial Ships
India owns less than one percent of the world’s commercial ships, and only 5 percent of the country’s exports/imports are carried on Indian-flagged vessels. While India builds many military ships, India has minimal domestic shipbuilding capability and relies heavily on foreign-built vessels. Global shipbuilding is dominated by three countries. China is the global leader, controlling approximately 40 percent of worldwide shipbuilding capacity. South Korea is second, with advanced capabilities and nearly 30 percent share. Japan, at 20 percent share, is the third-largest. Singapore has 5 percent share mainly in ship repair, maintenance, and is a maritime services hub. United Arab Emirates at 3 percent contributes to ship repair services and maritime support.
Most Indian commercial ships and related components are imported from countries like Italy, Spain, China, and Japan. India is also heavily dependent on imports for marine engines, sourcing them primarily from Germany, Finland, Japan, and South Korea.
India’s commercial shipping strategy centres on the Maritime India Vision (MIV) 2030, which aims to make India a global maritime leader through initiatives like port modernization, shipbuilding expansion, and improved logistics efficiency. Key pillars include a new ₹25,000 crore Maritime Development Fund (MDF) to finance shipbuilding and repair, expanding domestic tonnage capacity, developing shipbuilding clusters, and strengthening infrastructure for coastal and inland waterways. A 10-year import tax exemption on key shipbuilding components to boost local manufacturing.
Critical Minerals
India’s Critical Minerals strategy is centred on the National Critical Mineral Mission (NCMM), launched in 2025 to boost self-reliance in strategic minerals like lithium and cobalt. The strategy involves expanding domestic exploration through the Geological Survey of India (GSI), securing overseas assets via joint ventures, and fostering innovation through incentives, pilot projects, and research. It also includes strengthening the entire value chain, from mining and processing to recycling, and amending the Mines and Minerals (Development and Regulation) Act to give the central government authority over key minerals, and to auction 24 critical minerals.
GSI will conduct 1,200 exploration projects between 2024–25 and 2030–31 to identify new deposits of critical minerals. The joint venture Khanij Bidesh India Ltd. (KABIL) has been incorporated to identify and acquire overseas mineral assets in countries like Argentina and Australia.
The strategy includes a target of 1,000 patents by 2030 and the establishment of 7 Centres of Excellence to drive innovation. A ₹1,500 crore incentive scheme has been approved to boost critical mineral recycling capacity. The S&T PRISM program provides funding for start-ups and MSMEs to bridge the gap between research and commercialization. Pilot projects with ₹100 crore in funding are focusing on tapping unconventional sources like fly ash and mine tailings to recover valuable minerals. The Union Budget 2024–25 eliminated customs duties on many critical minerals to lower their cost and encourage processing facilities in India.
Rare Earths
There has been a continuous increase in India’s rare earth imports. In FY 2023–24, India imported 1,185 tonnes of rare earth metals. Nearly 70 percent was from China. China controls 70 percent of global mining and 85–90 percent of refining capacity. Japan was the source for 8–10 percent specialty rare earth processing and refined products. South Korea (5–6 percent) is the secondary supplier for processed rare earths. United States (2–3 percent) is a minor supplier of rare earth compounds.
India has significant rare earth reserves, primarily in monazite sands along its coasts, with notable deposits in Andhra Pradesh, Odisha, Tamil Nadu, Kerala, and Gujarat. China has the largest share of the world’s rare earth reserves, followed by Brazil and India, but India faces challenges in extraction and processing, and its deposits are rich in light rare earths but lack extractable quantities of some heavy rare earths like Dysprosium and Terbium.
India’s rare earth strategy focuses on increasing domestic production and reducing dependence on China. National Critical Mineral Stockpile (NCMS) to secure a two-month reserve of critical rare earth materials, a ₹7,300 crore incentive scheme for rare earth magnet manufacturing, and the NCMM to boost exploration and processing. To diversify the supply chain, the strategy also involves partnerships with countries like Russia to secure supply, reforming mining laws to unlock reserves, and developing a full value chain from mining to magnet production. India is negotiating trade pacts with other resource-rich nations like Chile and Peru. India aims to triple rare earth oxide production capacity by 2032.
Reforms in the mining sector include amending the Mines and Minerals (Development and Regulation) Act to make certain rare earth blocks available to private players. Exploring thousands of inactive mines and creating opportunities for private sector involvement in exploration and processing. India is working to create an integrated value chain from mining and refining to manufacturing finished products like magnets for EVs and turbines. Expanding beyond rare earths, the strategy includes a wider basket of critical minerals, with the NCMM identifying 30 such minerals for development.
To Summarise
It can be seen that China and some other East Asian suppliers are dominating the Indian market. China emerges as the top or near-top supplier in seven out of ten categories, reflecting India’s significant dependency on Chinese manufacturing and supply chains. Russia has seen a surge in crude oil after 2022, primarily due to reduced prices. All imports are price-differential dependent. China remained irreplaceable currently across manufacturing, lithium, APIs, and electronics, while Japan and South Korea led in robotics and heavy engineering equipment. There are also some geopolitical security considerations. India is concerned about buying military-related communications equipment from China.
India’s great success stories in manufacturing include its electronics sector, particularly mobile phone production, where it is the second-largest producer globally, automobiles, motorcycles, and now the defence industry, which has seen a significant rise in production and exports. Other success stories include the production of Vande Bharat trains, a booming toy industry that has turned into an exporter, and a rapidly growing renewable energy sector. The government policies are in place and being refined. It has to be a whole-of-nation approach. It is time to concentrate on import substitution sectors.
Note: The article was originally written by the Author for The First Post on, October 25th, 2025, it has since been updated.
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