The auto industry needs to cut imports and increase exports in order to make India truly Aatmanirbhar, noted Nitin Gadkari, Union Minister for Road Transport and Highways while speaking at the ACMA Annual Convention 2022.
Pointing toward the large gap between exports and imports, the Minister said, 'The vision of our honourable Prime Minister can only be achieved when we cut imports and increase imports.'
Notably, the imports made by the auto component industry stood at around INR 1.3 lakh crore last fiscal, whereas exports stood at INR 1.2 lakh crore, making for a “noticeable deficit”. It is also worth mentioning here that the entire automobile sector did business of over INR 7.8 lakh crore during the last fiscal. Of this, the auto components sector contributed a major share of INR 4.2 lakh crore.
The Minister also pointed toward the industry as a big contributor to India's GDP (3%). “Presently, the auto sector employs around four crore people. I see that number going up in the future,' he said.
It must be noted that the auto sector is the largest employment-providing sector in India. Moreover, the sector is also the largest contributor of GST to both state and central governments.
The auto sector, as per Gadkari, can leap into the next stage of transformation by embracing new technologies like electric vehicles, and alternate fuels like ethanol and LNG. India's agriculture sector produces surplus amounts of wheat, paddy and corn, and these three crops are primarily used in making LNG and ethanol.
'My idea is to transport hydrogen using vehicles powered by LNG and ethanol. I want to bring down the cost of hydrogen to $1per kg,' he said.
The other way for the auto component industry to go beyond its potential is by using the existing machinery to make components for public transport mediums such as sky rails and more. Gadkari requested ACMA to start an R&D wing to focus on developing components for alternate fuel-powered vehicles and public transport.
'The highest number of young engineers are available in India. We should utilise their skill and talent to the best,' he said. Gadkari is aiming for an INR 15 lakh crore worth of production of auto components in five years' time. He is hopeful that the cost of EV vehicles will be at par with the cost of ICE vehicles in two years' time.
The Minister also highlighted that the government is working on introducing ethanol as a blend with diesel. The same has already been done for the petrol, noted the Minister. The automobile industry will need to work on components for all such engines.
The sector can also benefit from India's existing scrappage policy as now the government will allow opening of three scrappage centres in each district. Scrapping of vehicles allows the auto industry to source steel, copper and more metals at lower prices, he said.
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