Asia Manufacturing Index 2026: India at 6th Position (UPSC)

The Asia Manufacturing Index 2026 was released recently, ranking India at 6th position among major Asian manufacturing economies, highlighting India’s competitiveness and policy challenges.

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• Prelims: Index ranking–report-based current affairs
• Essay: India’s manufacturing potential and global economic positioning

The Asia Manufacturing Index (AMI) 2026 is a benchmark ranking released by Dezan Shira & Associates, a leading pan-Asian market entry advisory firm based in Hong Kong. The index evaluates the manufacturing competitiveness of Asian economies, offering a comparative view of how countries rank in terms of industrial strength.

The AMI helps answer questions like:

• Which Asian countries are best for manufacturing?
• How competitive is India in Asia’s manufacturing landscape?
• What are the factors that determine manufacturing strength?

The 2026 edition is the third annual edition of the index and covers 11 Asian economies across eight key pillars and 43 sub-parameters.

What’s New in AMI 2026? Key Changes

The 2026 edition introduces:

• A transparent 1–100 scoring system for all parameters
• A historical archive for year-on-year comparison
• A more nuanced comparative analysis tool for investors and policymakers

These enhancements help in better understanding strengths and weaknesses across countries.

The rise of Asia as a global manufacturing hub has strategic, economic, and policy importance:

• Asia accounts for a significant share of global manufacturing output.
• Countries compete to attract foreign direct investment (FDI).
• The index reflects regional strengths in infrastructure, innovation, trade and workforce.
• India’s position reflects the success and challenges of initiatives like Make in India.

India ranks 6th out of 11 Asian economies in the Asia Manufacturing Index 2026. The table below presents the country-wise rankings of the 2026 index.

The Asia Manufacturing Index assesses countries across eight core pillars, each measuring real-world strengths and challenges:

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India retains the 6th position in AMI 2026, the same as in 2025 when the index expanded from 8 to 11 economies. India’s score reflects its strength in workforce and economy, but lags in tax policy and international trade compared to top rivals.

Strengths: Where India Excels

These strengths reflect India’s demographic advantage and rapid economic growth, making it attractive for manufacturing investments.

Weaknesses: Where India Needs Improvement

Addressing these weaknesses can help India climb higher in future editions.

Comparative Insights: Other Asian Countries

• China leads the index for the third consecutive year due to an unmatched industrial ecosystem and supply chain integration.
• Malaysia climbed to 2nd place, overtaking Vietnam.
• Vietnam remains strong at 3rd position, reflecting robust growth and trade openness.
• Singapore performs well on innovation & political risk but has a limited economic scale.

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1. Economic Positioning in Global Supply Chains

India’s rank indicates how effectively its economy is integrating into global and regional manufacturing supply chains, a key determinant of long-term economic growth.

2. Manufacturing-Led Growth Strategy

The index reflects the outcomes of policies such as the National Manufacturing Policy, Production Linked Incentive (PLI) schemes, and Make in India. It highlights areas where policy impact is visible and where gaps persist.

3. Trade Competitiveness and Market Access

India’s relatively lower international trade score underscores the need for deeper trade integration, improved logistics efficiency, and strategic trade agreements.

4. Investment and Industrial Reforms (Future Perspective)

Improving tax competitiveness, infrastructure quality, and ease of doing business can help India attract greater manufacturing investment and move up the rankings of the index.

5. Long-Term Strategic Outlook

Sustained reforms in innovation, skill development, and industrial clusters will be critical for India to transition from a cost-competitive manufacturing base to a value-driven manufacturing hub.

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India’s 6th position in the Asia Manufacturing Index 2026 highlights both opportunity and urgency:

• Its workforce and growing economy are major assets.
• Gaps in tax policy, trade integration and infrastructure need sustained reform.
• Strategic policies can help India rise in future rankings.