Manufacturing base and cost advantages to make India a leader in the global auto component market: NITI Aayog

India's growing manufacturing base and cost advantages position it as a potential market leader in the global automotive component market, according to a NITI Aayog report. The country's auto component exports have risen from Rs. 63,181 crore (US$ 7.4 billion) in FY21 to Rs. 1,09,286 crore (US$ 12.8 billion) in FY24, with a 73% surge since FY21. This growth reflects India's post-pandemic recovery and increasing global demand for auto components. Exports are dominated by Drive Transmission Systems (DTS), Engine Components, and Electrical and Electronics components, which account for 53% of the total export share. North America and Europe are the primary destinations, accounting for 34% and 27% of exports, respectively. The USA is a key export market, driving 28% of auto component exports, while Germany accounts for 7% of India's export share. The demand for high-quality automotive parts, especially engine components and transmission systems, highlights India's capabilities, with many components used in vehicles manufactured by global brands in Europe. India's proximity to Africa and Southeast Asia also presents opportunities for further export growth in these emerging markets.

On the import front, India has seen an 80% increase in auto component imports, from Rs. 57,205 crore (US$ 6.7 billion) in FY21 to Rs. 1,03,310 crore (US$ 12.1 billion) in FY24. Engine components and body/chassis/Body-in-White (BIW) dominate imports. China is the largest supplier, contributing nearly 23% of India's imports. The growing import figures indicate a robust domestic market and the need for high-quality components to support the expanding automotive industry.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.