This study examines the factors that motivate the adoption of information and communication technology (ICT) in the Indian manufacturing sector. The examination of this issue is relevant because the Indian manufacturing sector is currently undergoing a structural change, starting from automation and digitalization to implementing Industry 4.0. By collecting annual data (2005–2022) from registered manufacturing firms in the Centre for Monitoring Indian Economy (CMIE) prowess database and using panel Probit and panel Tobit models, the study finds that factors such as firm size, age, ownership structure, export intensity and profitability are key factors that motivate the adoption of ICT. However, these factors have heterogeneous effects once the firms are disaggregated based on their technical intensity. While low- and medium-tech firms show that the factors moderately affect ICT adoption, these determinants have a profound impact on ICT adoption in the case of high-tech manufacturing firms. Given the disparities in ICT adoption rates, the study highlights the necessity of targeted policy interventions to support ICT integration, particularly among technologically lagging firms.
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