India’s Opportunity in the $100 Billion Global Tools Market

Based on NITI Aayog’s April 2025 Report: “Unlocking $25+ Billion Exports: India’s Hand & Power Tools Sector”

Report Background

1. The report was published by NITI Aayog, the central government’s policy think tank.
2. It was prepared in collaboration with the Foundation of Economic Development.
3. It assessed 18 Indian states and gives a strategic roadmap to scale up India’s tools exports.

Global Market & China’s Dominance

4. The global tools market was worth $100 billion in 2022, projected to grow to $190 billion by 2035.
5. China holds nearly 50% share, due to large-scale, cost-efficient production and strong global supply chains.
6. But now, rising tariffs and increasing costs in China have created an opportunity for India.

India’s Current Status

7. India currently exports:
   • $600 million in hand tools
   • $425 million in power tools
8. This is just a tiny share of the global trade, but it shows untapped potential.

What Are Hand and Power Tools?

9. These are tools used in drilling, cutting, fastening, etc.
10. They are essential across industries like infrastructure, automotive, manufacturing, and household use.

NITI Aayog’s Vision: $25 Billion by 2035

11. India can build a $25 billion export-oriented tools industry by 2035.
12. To achieve this, bold policy reforms, world-class manufacturing clusters, and public-private collaboration are needed.

Key Recommendations in the Report

13. Build globally competitive tool manufacturing clusters.
14. Reduce structural cost disadvantages (like energy, logistics, and compliance costs).
15. Provide targeted government support, especially for small and medium enterprises (SMEs).

 

India’s Strengths

16. India has low-cost labour, a growing manufacturing base, and strategic trade access.
17. These can be used to bridge the 14–17% cost gap with global competitors.

Economic & Social Impact

18. NITI Aayog says tools manufacturing can drive inclusive growth, especially in states like Punjab and Maharashtra.
19. It can also strengthen MSMEs, increase employment, and reduce dependence on imports.
20. NITI Aayog believes India is at a turning point and can become a global leader in the tools industry with the right strategy and reforms.

 

Hand Tools	Power Tools	Raw Materials Required	Infrastructure Required
Screwdrivers	Electric drills	Steel and Alloys – for strength and durability	Forging & Casting Units – shaping metals into rough tool forms
Hammers	Angle grinders	Aluminum – used in lightweight power tool bodies and housings	CNC Machining & Precision Tooling – accurate cutting and shaping
Spanners/Wrenches	Electric saws	Plastics and Polymers – for handles, outer casings, switches, insulation	Heat Treatment Facilities – strengthen metal parts
Pliers	Nail guns	Copper and Wires – for electric motors, coils, internal wiring	Plastic Molding Units – for plastic parts like housings and switches
Saws (manual)	Heat guns	Rubber and Grips – for safe, anti-slip handles	Motor Assembly Units – to build and test internal motors
Chisels	Power sanders	Electronic Components – sensors, microcontrollers, switch circuits	Electronics Assembly Lines – for circuits in smart tools
Tape measures	Welding machines	Bearings, Screws, Springs, Small Fittings – for smooth movement and part assembly	Surface Finishing Units – polishing, painting, chrome plating
			Quality Testing & Calibration Labs – check strength & performance
			Packaging & Logistics Support – storage, transport, export