Page 29 - FIPI - Policy & Economic Report May 2026

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

? Steel - Steel production (weight: 17.92 %) increased by 6.2 % in April, 2026 over April, 2025. Its
cumulative index increased by 9.5 % during April to March, 2025-26 over corresponding period of
the previous year.

? Cement - Cement production (weight: 5.37 %) increased by 9.4 % in April, 2026 over April, 2025.
Its cumulative index increased by 8.7 % during FY2026 over corresponding period of the previous
year.

? Electricity - Electricity generation (weight: 19.85 %) increased by 4.1 % in April, 2026 over April,
2025. Its cumulative index increased by 1.0 % during FY2026 over corresponding period of the
previous year.

7. India Targets US$1 Trillion exports amid push for domestic manufacturing and import substitution

The Government of India has set an ambitious target of achieving US$1 trillion in exports during the
current year and US$2 trillion in exports over the next five years, reflecting the country’s increasing focus
on export-led growth, manufacturing expansion, and supply chain resilience. India’s exports have already
reached US$863 billion during the current year, registering nearly 5 % growth despite a challenging global
environment. Both merchandise and services exports have continued to record growth, supported by
improving competitiveness and expanding market access.

India has also been actively pursuing Free Trade Agreements (FTAs) with nearly 38 developed countries
over the past three-and-a-half years to provide Indian products preferential access to major global
markets. The Oman FTA is expected to come into effect from June 2026, while other finalised agreements
are also expected to become operational in phases.

The government has emphasized the need to strengthen domestic manufacturing capabilities and reduce
import dependence through import substitution and promotion of indigenous products. Industries have
been encouraged to monitor import trends and identify opportunities for local manufacturing across
sectors such as capital goods, machinery, and industrial products.

The report highlighted that rising domestic consumption and expansion of the middle class present
significant opportunities for Indian industries, MSMEs, and startups. However, if domestic production
capacity does not expand adequately, rising demand could increasingly be met through imports.
Improving quality standards, productivity, packaging, and competitiveness therefore remains critical for
strengthening India’s position in global export markets.

The government also underlined the growing importance of value addition in sectors such as agriculture,
fisheries, and manufacturing. Greater participation of young entrepreneurs and startups in value-added
manufacturing and export-oriented sectors is expected to support long-term industrial and trade growth.

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