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India must capitalise on its strong domestic demand potential and cost efficiencies in electronics manufacturing to become a strong ecosystem partner in robotics on the world stage
Image Source: Getty
On 19 April 2025, 21 humanoid robots raced alongside human runners for the first time in a half-marathon in Yizhuang, which houses most of Beijing’s tech firms. While the winning robot took more than twice as long as its fastest human counterpart, the marathon demonstrated China’s growing prowess in robotics. This is strengthened by an aggressive policy push to secure supply chains and ensure mass production with innovation in robotics, particularly humanoids, envisioned as a ‘new engine of economic growth’ to boost a sluggish economy.
Although China continues to lead globally in robotics installation by a wide margin, such integration is fulfilled by foreign manufacturers primarily from Japan, South Korea, and Europe. This makes these exhibitions of growing domestic capabilities an important signal to the world—that China is continuously building as it scales, and asserting itself as the largest market and a potential manufacturing hub, aiming to secure supply chains and component production.
The potential market opportunities have led the United States-based tech giants such as Meta, Microsoft, NVIDIA, and Amazon to invest heavily in this space, with Tesla’s Optimus prototype as a frontrunner.
Robotics has wide-ranging potential applications across industrial, consumer, and military domains. The worldwide robotics market is expected to grow 16.35 percent between 2025 and 2033 to reach US$ 178.7 billion by 2033, spurred by advancements in Artificial Intelligence (AI), demand for automation, labour shortages and rising labour costs, and favourable government policies. While robotics has had a high application in the industrial domain, humanoid robots are expected to be more general-purpose, with diversifying applications. The total addressable market for humanoid robots is expected to reach US$ 38 billion by 2035. The potential market opportunities have led the United States-based tech giants such as Meta, Microsoft, NVIDIA, and Amazon to invest heavily in this space, with Tesla’s Optimus prototype as a frontrunner. However, advancements in robotics involve a combination of hardware and software that are incredibly difficult to optimise across multiple functions that robots are expected to perform, which restricts opportunities to scale.
While the US leads the world in software design, Asia has been the primary growth driver in the industry, with China emerging as the largest market and overall robot installation. Japan is the world’s largest industrial robotics manufacturer, delivering 45 percent of the global supply. 36 percent of Japanese exports are destined for China, followed by the US with a 22 percent share. India is one of the fastest-growing markets in Asia, with robotics installations increasing by 59 percent in 2023, propelled by the automotive industry, where demand registered an increase of 139 percent contributed by both car manufacturers and suppliers. This highlights the need to understand how to cater to the rising domestic demand, reduce dependence, and ensure global competitiveness and strategic alignment as an ecosystem partner on the world stage.
Thinking of robotics as cyber-physical systems highlights challenges and constraints within the product development processes. These involve data requirements for software iteration and the complexity of different use case contexts to train the robotic systems, which often run counter to timelines in hardware development and conditions for commercial scaling and mass production. This reflects some of the bottlenecks in building and scaling robotics systems today. Most humanoid robots can work in bursts of one to two hours before the need for recharge. Similarly, while some master agility and mobility, others can perform cognitive or intellectual tasks, and have remained largely mutually exclusive. Moreover, the hardware development often lags behind software with truncated data-driven feedback loops. These bottlenecks hindering scale and commercialisation reflect countries’ inability to successfully venture into different aspects of the ecosystem.
The US ran a trade deficit of US$ 1.2 billion in robotics, with exports accounting for just 28 percent of the value of the imports.
The US has been unable to convert its innovation potential into viable application use cases, the bulk of which remains in Asia, led by China, Japan, and South Korea. China has the highest robot installations, making it the largest market. Japan dominates manufacturing, while South Korea has the highest robot density or installed robots per 10,000 workers. In 2022, the US ran a trade deficit of US$ 1.2 billion in robotics, with exports accounting for just 28 percent of the value of the imports. In 2024, China led the world in robotics patents, accounting for two-thirds of the global volume. However, despite these advancements in innovation and supportive innovation policies, self-sufficiency has been difficult to achieve for the latter, though it is making aggressive advancements in that direction.
As highlighted above, India has strong internal demand with potential transformative impacts and efficiency gains if integrated well across sectors. India already has a significant economic dependence on China, with rising demand in robotics poised to reinforce the dependence, with China’s low-cost manufacturing bid as well as on other foreign suppliers. This makes it imperative to identify opportunities for India to position itself as a key player in this domain to develop and maintain its strategic advantage in frontier domains, increasingly shaping geopolitical considerations.
However, India is yet to implement a national robotics policy. The combination of AI and robotics is set to define the frontiers across multiple sectors, and India has a unique opportunity to position itself as a trusted ecosystem partner on the world stage. India is set to become the global hub for electronics manufacturing. It can offer cost efficiencies in robotics manufacturing capabilities to complement the US leadership in Internet Protocol (IP) and software. While Japan remains a global leader in robotics manufacturing, it faces constraints for skilled labour supply, while remaining price competitive in commercialising and scaling innovation. This highlights significant opportunities for India to be a trusted partner to key players. This can be done through a multi-pronged and integrated innovation strategy combining supportive electronics and advanced manufacturing policies, fostering applied research and development, harnessing private investment, and stimulating domestic demand.
The combination of AI and robotics is set to define the frontiers across multiple sectors, and India has a unique opportunity to position itself as a trusted ecosystem partner on the world stage.
This highlights the need for India to forge strategic technological partnerships based on strong complementarities to drive knowledge and technology transfer and carve out a key position for itself within the value chain through cost-effective manufacturing. This can help advance commercialisation, scaling up of robotics manufacturing globally, and place India at the forefront of advanced manufacturing. In addition to strategic partnerships, India can leverage its software prowess to boost the AI-robotics integration to drive the move from concept to application, paving the way for domestic innovation and scale to meet domestic and export demand.
India has budding robotics start-ups, and there is increased governmental push towards more investment in deeptech start-ups. However, deeptech remained one of the least favoured segments among Indian investors. This requires a defined robotic strategy that can be effectively integrated with other policies, particularly those on AI, DeepTech, and Electronics. There is also an added need to stimulate investor interest by helping with demand support through public procurement in sectors such as defence, ease of access to finance for businesses aiming for transformation, and state support to ensure the products are price-competitive to stimulate adoption across industries and sectors. A comprehensive approach would help identify pathways and trajectories to position India as a key player globally in this domain.
Anulekha Nandi is a Fellow at the Centre for Security, Strategy and Technology at the Observer Research Foundation.
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Dr. Anulekha Nandi is a Fellow - Centre for Security, Strategy and Technology at ORF. Her primary area of research includes digital innovation management and ...
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