Praful Patel, Minister of Heavy Industries and Public Enterprises, estimated that the combined turnout of Indian automobile and auto component sector will provide more than 10 percent of the country's Gross Domestic Product (GDP) in next four years. He also revealed that the compound turnover may be in excess of $ 145 billion by 2016.
Speaking at the annual conference of Automotive Component Manufacturers Association of India (ACMA), Patel said, “The output of the automobile and auto component industry would reach $145 billion by 2016, accounting for more than 10 percent of the country's GDP and in turn generate employment for more than a million people.”
Patel has recommended the Indian auto component industry to expand their Research and Development (R&D) departments, besides increasing its budget, in order to reach global standards. According to the minister, increased investment and emphasis on R&D will help the Indian auto component industry to augment its export operations via bilateral trade accords and provincial free trade agreements (FTAs) as well.
The minister further revealed that the surge in automotive and auto component sectors have influenced the government's target projections for both the sectors under the decade long Automotive Mission Plan 2006-16. Patel further said, “As per the 12th Five Year Plan, the ministry is reviewing targets set up under the Automotive Mission Plan 2006-16.”
Reportedly, the Indian auto component sector has recorded healthy growth over the last half-decade with a growth of 15 per cent compounded yearly. Hence, the Ministry of Heavy Industries and Public Enterprises is projecting the sector as the one with great potential and knows that in coming years the industry will contribute a large fraction to the Indian economy.
