The Associated Chambers of Commerce and Industry of India (ASSOCHAM) has urged the government for liberal export incentives to bridge the trade gap, so that exports remain much more lucrative than the domestic market.
Lack of trust among the manufacturers in the auto parts industry in the Jamshedpur district of Jharkhand is hampering the smooth running of the industry. Most of the manufacturers in the industry do not trust each other and refuse to co-ordinate with other industrialists.
Business for automotive spare parts dealers in Shimoga, Karnataka, is not great. Rising competition, including from the migrant population, and the growing number of credit transactions are together hurting profit margins, according to an industry body.
Heavy Industries Minister Praful Patel Wednesday said the Indian automobile and auto component industry turnover will reach $145 billion by 2016 to account for more than 10 percent of gross domestic product (GDP).
Even with shrinking margins, the automobile component market is a significant contributor to India’s GDP. SMEs represent the major chunk of Indian automobile components market. The industry's output touched the figure of US$39.9 billion in terms of turnover for the 2010-11 fiscal year, with a growth rate of 33 percent compared to the 2009-10 fiscal year.
Indian automobile manufacturers reported a steady sales growth in April. Exports, however, slowed down a bit during the month.
The Tamil Nadu government will sign investment agreements with several automobile and auto component makers and come out with a series of industry-specific policies soon, Chief Minister J Jayalalithaa said.
The Indian automobile industry is expecting a 10-12 percent rise in sales in fiscal 2012-13 from over 17 lakh units sold in 2011-12 on better macro-economic conditions, an industry body said.