For many years, India’s economic growth revolved around major cities like Delhi, Mumbai, and Bengaluru. These cities were home to the country’s most prominent businesses. However, this landscape is shifting.
The Rise of Modern Bharat
In the last decade, we’ve witnessed a transformation termed Modern Bharat. This change is fueled by improvements in both physical infrastructure, like new highways and airports, and digital connectivity, with broadband internet linking even remote areas to the global market.
Reforms like GST and initiatives such as Make in India have empowered entrepreneurs in smaller cities to grow and create jobs. As a result, non-metro cities are now crucial players in the economy. For example, in FY26, 21 out of 97 mainboard IPOs came from tier 2 and 3 cities, and a significant portion of new IPO investors in 2025 were from these areas. Remarkably, half of the startups recognized by the Department for Promotion of Industry and Internal Trade (DPIIT) originated in smaller cities.
While large corporations continue to drive India’s growth, a new wave of businesses from smaller towns is emerging, pushing the economy forward.
The Drive for Growth
Many companies beyond the big cities have carved out successful niches. They’re not just focused on domestic sales but are also making strides in global markets, often referred to as the “Kohinoors” of Modern Bharat.
These companies, while still relatively unknown, have demonstrated strong financial performance, often achieving earnings before interest, taxes, depreciation, and amortization (EBITDA) exceeding INR 100 crore, thanks to solid governance and discipline.
What Sets Them Apart?
These emerging leaders span various sectors—precision manufacturing, pharmaceuticals, and consumer goods, among others. They share a commitment to quality, scalability, and long-term growth. Their resilience is notable; these entrepreneurs tend to invest in technology and talent even during uncertain times, setting them apart.
Another distinguishing factor is their ability to execute quickly. Many have embraced digital tools and data-driven strategies early on, positioning themselves for success in global markets. For instance, a design-focused lamination firm now exports to over 40 countries. Such “Bharatpreneurs” are transforming from cost-efficient producers to innovative global suppliers.
Inspiring Future Champions
The stories of these companies illustrate what can be achieved through ambition and discipline. Recognizing these hidden gems is essential, as they play a vital role in shaping India’s economic future.
Industry experts see this transformation as a timely opportunity for investment. According to a recent survey by EY, businesses in tier 2 and 3 cities are expected to be the next generation of global champions. Their impact on India’s economy is growing and should not be overlooked.
In summary, the evolution of Modern Bharat highlights the potential of innovative businesses from smaller towns. It’s an exciting time for India, where the future of its economy might just lie beyond the traditional urban centers.
(Views are personal; the author is a Partner and National Clients & Industries Leader at EY India.)
