India Manufacturing Space Leasing Projected to Reach 32 Million Square Feet by 2030: Savills India Report
Gurugram, September 9, 2026: Industrial space leasing in India’s manufacturing sector is projected to reach 30 to 32 million square feet by 2030, registering a compound annual growth rate (CAGR) of 7 to 9 percent between 2025 and 2030, according to a report by property consulting firm Savills India titled “Beyond Make in India: The Rise of Made by India.”
The report highlights a significant surge in demand from 2020 to 2025, during which leasing expanded at a 30 percent CAGR. While primary manufacturing activity remains concentrated in major industrial hubs like Pune, which led absorption with 26.7 million square feet, and Chennai with 9.4 million square feet, momentum is increasingly spreading to Tier-II and Tier-III locations such as Hosur and Ahmedabad.
Sectoral absorption between 2020 and 2025 was dominated by auto and auto components, which accounted for 18.6 million square feet (29 percent of total leasing), followed by electrical and electronics at 11.5 million square feet (18 percent). Machinery and equipment recorded 5.4 million square feet (9 percent), while the renewable energy segment accounted for 5.1 million square feet (8 percent).
Foreign occupiers drove a substantial portion of the space absorption. European entities led manufacturing space leasing with a 44 percent share, followed by companies from the Asia-Pacific region at 31 percent, the Americas at 24 percent, and the Middle East at 1 percent.
The average leased space size grew from 71,000 square feet in 2022 to 94,000 square feet in 2025, pointing toward tenant preference for larger, Grade-A compliant facilities that support automation, scalability, and sustainability standards.
“Government initiatives such as ‘Make in India’, the PLI scheme and ‘Atmanirbhar Bharat’, along with global supply chain shifts, are accelerating India’s transition from ‘Make in India’ to ‘Made by India’, positioning it as a competitive manufacturing and export hub. Over time, the sector is expected to move beyond its traditional cost advantage towards a capability-led ecosystem anchored in innovation, supply chain resilience, and export competitiveness,” said Srinivas N, Managing Director – Industrial & Logistics, Savills India.
Looking ahead, future demand is expected to be propelled by high-growth segments including semiconductors, electric vehicles, battery storage, and aerospace and defense.
