AI to EVs: 9 Sectors May Fuel $738B Growth for India by 2030

India’s economic future could be transformed by a sharp focus on nine high-potential sectors that harness uniquely Indian capabilities, according to a new report by McKinsey & Company. The report projects that these sectors could collectively generate $588 billion to $738 billion in annual revenue by 2030, representing a more than 3.5x increase from the $164–206 billion recorded in 2023.

The nine transformative sectors identified as engines of growth are: e-commerce, semiconductors, cloud services, cybersecurity, electric vehicles (EVs) and batteries, artificial intelligence (AI) software and services, space, nuclear fission, and robotics.

These sectors were selected based on indicators such as patent activity at twice the median level or research and development (R&D) investments surpassing the national average by a factor of two — signaling strong innovation intensity and scalable economic potential.

Among the sectors, e-commerce is expected to lead revenue generation, with McKinsey projecting a fourfold rise — from $60–70 billion in 2023 to $240–300 billion by 2030. E-commerce currently makes up 7–9% of India’s total retail sales and is poised to grow to 15–17% by 2030. By the end of the decade, this sector alone could account for nearly 40% of the total projected revenue from the nine sectors.

India’s semiconductor sector is also poised for a major leap, with revenues expected to nearly triple from $40–45 billion in 2023 to $100–120 billion by 2030, bolstered by multiple domestic projects now taking shape.

The artificial intelligence (AI) software and services sector is forecast to grow between fivefold and eightfold, reflecting India’s rapid adoption of AI tools such as Copilot and a growing shift toward agentic AI systems and AI-driven automation.

Supporting this AI momentum is the cloud services sector, which is projected to grow four to five times, reaching $70–80 billion by 2030, largely driven by the massive data demands of AI-powered platforms and industrial processes.

The much-anticipated electric vehicle (EV) sector is expected to register a sixfold to eightfold increase, growing from a nascent base to $40–60 billion in annual revenue by 2030.

Meanwhile, India’s space and nuclear fission sectors — both of which are benefiting from strong government backing and increased investment — are forecast to grow fourfold to fivefold over the same period.

These capital- and research-intensive industries are channeling significant resources into innovation. Nuclear fission, for instance, allocates 8–10% of revenues toward R&D, while space ventures are investing around 4% — both far above the industry norm of 2%.

If realized, the McKinsey estimates would mark a major shift in India’s economic trajectory, fueled by technology, innovation, and future-ready industries. The report suggests that India’s blend of domestic capabilities, talent depth, and policy support could enable these sectors to drive disproportionate growth over the next five years.

With the right focus on infrastructure, policy alignment, and investment in research and development, India stands at the threshold of an economic transformation — one anchored in deep tech, digital innovation, and industrial reinvention.

ALSO READ: India Sees 29% Jump in New Company Registrations in May