In a strategic move to position itself as a manufacturing powerhouse, Uttar Pradesh (UP) is aggressively rolling out policies aligned with India’s broader China+1 strategy. This approach aims to attract companies diversifying their supply chains away from China to reduce geopolitical and operational risks.
UP’s Vision: Becoming India’s Factory Floor
The UP government, under Chief Minister Yogi Adityanath, is working to transform the state into a preferred destination for global manufacturing investments. Key enablers in this drive include:
- Industrial policies with fiscal incentives for electronics, defence, textiles, pharmaceuticals, and data centres
- Robust development of integrated industrial townships, expressways, and logistic corridors
- Strategic land bank availability to support mega manufacturing parks
- Faster approvals under its revamped single-window system, Nivesh Mitra
Why China+1 Is Relevant for UP
The China+1 strategy has gained momentum globally, with multinational companies looking to de-risk supply chains and reduce overdependence on China. UP sees itself as:
- An alternative base with competitive labour costs
- Strategically located with proximity to the Delhi-NCR consumption hub
- Offering large contiguous land parcels for industrial estates
- Having a population advantage with abundant workforce availability
Sectoral Push: Electronics, Defence, Textiles, Pharma Lead
The state has identified multiple sectors for targeted investment promotion:
| Sector | Focus Areas | Recent Moves & Announcements |
|---|---|---|
| Electronics Manufacturing | Mobile phones, components, semiconductor packaging | Expansion of existing Samsung and Lava units; plans to develop electronics manufacturing clusters near Noida and Greater Noida |
| Defence & Aerospace | Drones, avionics, MRO | Aligarh and Bundelkhand nodes under UP Defence Industrial Corridor seeing increasing private sector interest |
| Textiles & Apparel | Readymade garments, technical textiles | Investment proposals for large textile parks in Gorakhpur and Hardoi under PM MITRA scheme |
| Pharmaceuticals & Medical Devices | Formulations, bulk drugs, medical equipment | Medical device park planned in Gautam Buddha Nagar; policy incentives for pharma SMEs |
| Renewable Energy | Solar modules, storage, green hydrogen | Attracting investments for solar PV manufacturing linked with energy corridor development |
Key Industrial Corridors and Infrastructure Projects
To operationalise its manufacturing vision, UP is executing multi-modal connectivity projects:
- Eastern and Western Dedicated Freight Corridors (DFCs) connecting industrial hubs to ports
- Purvanchal Expressway, Bundelkhand Expressway, Ganga Expressway, enabling seamless East-West and North-South logistics
- Jewar International Airport, envisaged as an export gateway for electronics and perishable goods
- Development of Integrated Manufacturing Clusters (IMCs) under Delhi-Mumbai Industrial Corridor (DMIC)
UP’s Electronics Manufacturing Landscape: A Snapshot
| Metric | Data |
|---|---|
| Operational mobile manufacturing units | Over 60 |
| Employment generated | 1 lakh+ direct jobs |
| Exports from sector (FY24) | ₹30,000 crore |
| Major players | Samsung, Dixon, Lava, Oppo, Vivo, Micromax |
Investment Pipeline Under Global Interest
According to state industrial development authorities, UP has seen:
- MoUs worth ₹33 lakh crore signed during Global Investors Summit 2023, with a significant share from manufacturing
- Delegations from Japan, South Korea, Taiwan, Germany, and the US showing interest in electronics, defence, and EV manufacturing
Policy Measures to Accelerate China+1 Strategy
UP is implementing policy interventions including:
- Interest subsidies and stamp duty exemptions for industries setting up new units
- Production-Linked Incentives (PLI) convergence with central schemes to offer dual benefits
- Dedicated ‘Ease of Doing Business’ cells to fast-track investment clearances
- Skill development programmes in coordination with major industries to create an employable manufacturing workforce
Comparative Statewise China+1 Positioning in India
| State | Primary Sector Focus | Key Advantages |
|---|---|---|
| Uttar Pradesh | Electronics, defence, textiles | Land availability, population, proximity to NCR |
| Tamil Nadu | Automobiles, electronics | Established supplier ecosystem, ports |
| Gujarat | Chemicals, engineering, renewables | Strong infrastructure, policy incentives |
| Maharashtra | EVs, IT hardware, pharma | Metro connectivity, skilled workforce |
| Karnataka | Aerospace, semiconductors | R&D ecosystem, tech talent |
Challenges in UP’s Manufacturing Push
Despite its aggressive policies, UP must address:
- Power reliability and cost competitiveness in remote districts
- Labour law rationalisation to ease operations for global investors
- Ensuring environmental clearances do not slow down project execution
- Efficient logistics linkages between industrial estates and ports
Officials’ Optimism
According to state MSME and Industrial Development departments, UP expects:
- Manufacturing GVA share to rise from 14% to over 20% of state GDP by 2027
- Direct manufacturing employment generation of over 3 million by 2027
- Doubling of merchandise exports through electronics and textile-led growth
The Road Ahead
With global geopolitical realignments post-Covid and rising risks from Taiwan strait tensions, multinational firms are accelerating their China+1 diversification. UP’s vision is to tap this once-in-a-generation opportunity through:
- Mega industrial corridors with plug-and-play infrastructure
- Policy stability with continued high-level monitoring by the Chief Minister’s office
- Creating a holistic ecosystem of MSMEs, skilling institutes, logistics providers, and anchor companies
Conclusion
As UP strives to emerge as India’s new factory hub, it aligns with the national mission to make India a $5 trillion economy with a strong manufacturing backbone. If executed efficiently, UP’s China+1 push could catalyse not only its own growth but also reposition India as a viable alternative to global manufacturing dependence on China.
Disclaimer: This content is for general news reporting purposes only and reflects current announcements and policy data by Uttar Pradesh government and industry bodies. Readers are advised to consult official state notifications and industry publications for project-wise investment details, land acquisition policies, and incentives before making any business or financial decisions.
