Goyal urges auto component makers to boost production, cut imports, target $100 billion exports

Production of auto components: Commerce and Industry Minister Piyush Goyal on Monday asked Indian auto component makers to explore ways to cut reliance on imports and boost local manufacturing to make the country a net exporter of these products.

The minister also urged these companies to target $100 billion in exports by 2030.

Addressing the auto component industry here, he expressed his concern over the continued reliance on foreign suppliers and encouraged domestic manufacturers to enhance local production capabilities.

"Many of our component manufacturers still import, I do not know whether (due to) any compulsion or voluntarily, their needs of inputs from Korea, Japan, Taiwan and one of the neighbours.

"I do not understand why even two or three levels down, we cannot plan to become indigenous suppliers and manufacturers so that we can then start supplying those components to other countries," Goyal said.

With the huge Indian market and global opportunities, the industry can increase the exports to $ 100 billion by 2030 from $ 21.5 billion at present, he added.

The minister added that the government is developing 20 smart industrial cities with the complete ecosystem that an industry requires and the component sector can explore opportunities in these industrial townships.

The auto component makers can take a full township and develop it to suit "yourself and your collaborators", he added.

"I would urge some of you to examine and see if you want me to dedicate one or two (of the townships) to your industry, I am happy to do that. I have offered it to Singapore, for example, that we (India) will create a Singapore for you in India. We can have restaurants, hotels, schools and colleges for them (in the city)," he said.

Further, talking about free trade agreements, Goyal said in so many FTA discussions and negotiations, the commerce ministry has to struggle with the Indian industry to try and get them on board, to try and make them understand the benefits of these pacts and open markets.

These agreements also benefit Indian industry as the pacts bring modern technologies, and improve efficiencies.

"But very often many sectors are not able to understand that easily, some did not understand ever, but I must acknowledge that the auto component manufacturer is one sector that has been really bold when it comes to world competition from anywhere in the world and has been proactive in all FTA negotiations," he noted.

He also asked the auto sector to formulate a roadmap to reach on top from the third-largest auto market in the world at present.

Goyal asked the industry to explore investment opportunities from EFTA countries, which have signed a trade pact with India.

India and the four-nation European bloc EFTA in March signed a free trade agreement under which New Delhi has received an investment commitment of $ 100 billion over the next 15 years to facilitate the creation of one million jobs.

The European Free Trade Association (EFTA) members are Iceland, Liechtenstein, Norway, and Switzerland.

"They (EFTA nations) do have technologies. They would certainly be interested in investing in Indian markets for profits and growth and Indian companies have a huge competitive edge. You can attract good investments from EFTA countries," he said.

Further, the commerce minister said that a German company wants the Indian government or private sector to buy them out. He did not disclose the name of the firm.

"A week ago, a very large German company in a sector very much associated with all of us, possibly in the stock market, gone down to zero value, urging me that India needs to buy it off. This is the time, why doesn't someone from our company or government buy it off," he said.

The minister added that the government will not be in a position to take a decision overnight and assess the pros and cons of acquiring that firm, but "one of you can possibly do that".

He also informed the gathering that the German firm has a large amount of technologies, which India could do wonders with.

He asked the sector to educate customers about the importance of products made by original equipment manufacturers.