A surge in automotive industry since the nineties has led to robust growth of the auto component sector in the country. In tandem with the industry trends, the sector has shown great advances in recent years in terms of growth, spread, absorption of new technologies and flexibility. There has been a major growth with the arrival of international vehicle manufacturers from Japan, Korea, US and Europe. Today, India is emerging as one of the key auto components centre in Asia and is expected to play a significant role in the global automotive supply chain in the near future.
The advantages that India offers in this industry:
Technological advantage
Cost competitiveness
Skilled manpower
Well developed, globally competitive auto ancillary industry
Established automobile testing and R&D centers
Among the lowest-cost producers of steel in the world
Why this industry is especially interesting for FDI:
Automatic approval for foreign equity investment up to 100 % of manufacture of automobiles and component is permitted.
The Indian auto industry has a turnover of US$ 12 billion and the auto parts industry has a turnover US$ 3 billion.
The automobile industry is de-licensed.
Import of components is freely allowed.
Source: Ministry of External Affairs: INDIA , Dynamic Business Partner: Investor Friendly Destination
