What is a Sunrise Sector

What we will learn today??

One-Liners for Quick Revision

Sunrise sector = new/emerging industry with high growth potential; sunset sector = mature/declining one.
Core features: high growth, innovation, VC funding, media attention, market disruption.
India’s key sunrise sectors: semiconductors, green hydrogen, EVs/battery storage, renewable energy, space, drones, fintech, AI, biotechnology.
India’s main policy tool: Production-Linked Incentive (PLI) Schemes — 14 sectors covered.
IN-SPACe (est. 2020) — regulates/promotes private participation in India’s space sector.
National Green Hydrogen Mission — India’s push to become a global green hydrogen hub.
IT services = a former sunrise sector that has since matured.

A sunrise sector is a new or relatively young industry that is:
- Growing rapidly, and
- Expected to become economically significant in the future.
The term contrasts with a “sunset sector” — a mature or declining industry whose peak growth is already behind it.
Why it matters: early, globally competitive leadership in a sunrise sector can shape a country’s economic position for decades.

High growth rates — revenue, investment, and employment grow much faster than overall GDP.
Disruption & new markets — often creates entirely new categories of economic activity, or disrupts existing ones.
Innovation & start-up intensity — high density of start-ups, R&D spending, and new business models.
Heavy investment inflow — attracts venture capital and FDI due to high growth potential.
Positive media & policy attention — public “buzz” often translates into supportive government policy.
High future potential, but uncertain outcomes — riskier than mature sectors, but with a much higher growth ceiling.

Aspect	Sunrise Sector	Sunset Sector
Lifecycle stage	Early / emerging	Mature / declining
Growth trend	Rapid, often exponential	Flat or shrinking
Investment trend	Rising (VC, FDI)	Falling
Employment trend	Expanding	Contracting / automating
Policy stance	Actively promoted (PLI-type schemes)	Managed decline / transition support
Examples	Renewable energy, AI, EVs, semiconductors	Some legacy manufacturing, traditional textile segments, coal (long run)

Semiconductors — India Semiconductor Mission (ISM); PLI-linked incentives for chip design & fabrication.
Green Hydrogen — National Green Hydrogen Mission; India targets becoming a global green hydrogen hub.
Electric Vehicles (EVs) & Battery Storage — FAME scheme; PLI for Advanced Chemistry Cell (ACC) battery storage.
Renewable Energy — solar + wind expansion under India’s 500 GW non-fossil fuel target by 2030.
Space Sector — opened to private players (2020 reforms); regulated/promoted via IN-SPACe.
Drones — PLI Scheme for Drones and Drone Components (2021) — agriculture, defence, logistics uses.
Fintech — UPI-driven digital payments ecosystem; among the most closely watched sectors globally.
Artificial Intelligence — IndiaAI Mission — compute infrastructure, datasets, applied AI capacity.
Biotechnology / Bio-manufacturing — flagged in Economic Surveys as a next-gen growth driver.

First-mover advantage — early leadership can mean long-term export competitiveness (e.g., China in solar panels).
Future employment — sunrise sectors are expected to generate tomorrow’s jobs for a young workforce.
Reducing import dependence — targets self-reliance in critical tech (chips, batteries, solar cells) under Atmanirbhar Bharat.
PLI Schemes — India’s flagship tool; incentives tied to incremental production/sales, across 14 sectors (electronics, pharma, telecom equipment, solar PV, batteries, etc.).

“High-tech” is not a requirement — the defining trait is growth trajectory, not technological sophistication.
Sunrise status isn’t permanent — sectors mature (e.g., Indian IT services was a classic sunrise sector in the 1990s–2000s; now a mature industry).
Government support ≠ guaranteed success — sunrise sectors still carry high risk.

Q. With reference to “Sunrise Sectors” in the Indian economy, consider the following statements:

A sunrise sector is characterised by rapid growth and high future economic potential.
The Production-Linked Incentive (PLI) Scheme is a key policy tool used by the Government of India to promote sunrise sectors.
IN-SPACe was established to regulate and promote private-sector participation in India’s space sector.

Which of the statements given above is/are correct?

A. 1 only B. 1 and 3 only C. 1, 2 and 3 D. 2 and 3 only

Answer: C

Explanation: All three statements are correct.

Statement 1: A sunrise sector, by definition, is a young industry marked by rapid growth and strong future potential.
Statement 2: The PLI Scheme, covering 14 sectors, is India’s flagship instrument for incentivising growth in emerging/priority sectors.
Statement 3: IN-SPACe (Indian National Space Promotion and Authorisation Centre), set up in 2020, enables and regulates private participation in space activities.