India an attractive destination for auto manufacturers

GERMANY: India has become an attractive destination for most automobile manufacturers in the world. The auto industry is one of the fastest growing sectors in Indian economy today, registering an average growth of 17 per cent over the last five years and opened up a huge domestic market.

"While the domestic market has provided a good opportunity to the manufacturers to sell their products, the excellent infrastructure coupled with skilled manpower at low costs has given the opportunity to make India a hub for automotive exports," said Sontosh Mohan Dev, Union Minister of Heavy Industries and Public Enterprises at the inaugural function of “IAA 61st Commercial Vehicle Motor Show-2006”, at Hanover, Germany.

He said "The auto component exports from India are growing at a rate of over 30 per cent and has reached US $ four billions and urged the industry to take full advantage of the excellent opportunity that India offered to the auto and auto component manufacturers. With the globalisation of trade under WTO, opportunities for everyone was emerging in large proportions. India was a totally WTO compliant country, he added.

The minister invited the German automotive sector to join hands with India as a partner in the highly exciting and rewarding journey into the future of global automotive manufacturing.

The Minister said "The Indo-German partnership in most industrial sectors, especially in the automotive industry, is approaching a new high. In the automotive sector, a number of important German vehicle manufacturers like Daimler Chrysler, BMW, MAN etc., already have a presence in India. The first major announcement this year was made by Force Motors of India and MAN of Germany in April, 2006 when Prime Minister Dr. Manmohan Singh visited Hannover in Germany. Volkswagen is also likely to make an announcement regarding establishing manufacturing operations in India."

He also said that India’s Auto Policy encouraged 100% Foreign Direct Investment without any local tie-up and the sector was fully de-licensed and de-regulated. Moreover, to align with the rest of the world, India has also joined the WP-29 forum of the United Nations for harmonizing automotive standards with the global ones.  Indian Automotive Industry produced about 9.7 million vehicles in 2005-06, he added.

The Minister, however, said that India still was very small in global market with four billion dollar worth of exports and the country was taking decisive steps to enhance global presence in this sector.

© CIOL Bureau