Twenty per cent growth of auto industry in India

Automotive Industry in India as also in the world is one of the largest industries and key sectors of the economy. It has a strong multiplier effect and is capable of being the driver of economic growth.

The Indian automotive industry started its new journey from 1991with delicensing of the sector and subsequent opening up for 100 per cent FDI through automatic route. Since then almost all the global majors have set up their facilities in India taking the production of vehicle from 2 million in 1991 to 9.7 million in 2006.

The cumulative annual growth rate of production of the automotive industry from the year 2000-2001 to 2005-2006 was 17 per cent. The cumulative annual growth rate of exports during the period 2000-01 to 2005-06 was 32.92 per cent. The production of the automotive industry is expected to achieve a growth rate of over 20 per cent in 2006-07 and about 15 per cent in 2007-08. The export during the same period is expected to grow over 20 per cent.

To maintain this high rate of growth and to retain the attractiveness of Indian market and further enhancing the competitiveness of Indian companies, the Government prepared a ten-year Automotive Mission Plan. The idea is to draw a futuristic plan of action with full participation of the stakeholders and to implement it in mission mode to meet the challenges coming in the way of growth of industry. Besides, making concerted efforts for removal of obstacles in the way of competition, the required infrastructure be put in place well in time to alleviate its constraining impact on the growth. Through this Automotive Mission Plan, Government also wants to provide a level playing field to the players in the sector and to lay a predictable future direction of growth to enable the manufacturers in making a more informed investment decision.

Source : Press Information Bureau

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