“Going forward, I suspect they are the ones who will be out of competition first because what Indian component manufacturers can do — their affordability and high quality of precision engineering — is unmatched and those who do not depend on Indian components not only in India but across the world will lose their competitive edge,” he said at the Auto Component Expo 2025.
China is the leading source of auto components exports and currently, accounts for around 28 per cent of the overall shipments into India.
Imports of auto components grew by 4 per cent from USD 10.6 billion (Rs 87,425 crore) in the April-September period of the last fiscal to USD 11 billion (Rs 92,050 crore) in the first half of 2024-25.
The minister added that if the industry can make quality a safe component for different vehicles, they should engage in manufacturing machines, which are used in their sector. “There is still a lot of machinery I see coming from other parts of the world. It’s high time some of us get into machine building. It should be very easy. Why should we be dependent on foreign countries, particularly some countries that have non-transparent economic practices? Why should we be dependent on them for the machinery and equipment that our industry needs,” Goyal noted. He added India has signed a free trade agreement with the European nation EFTA bloc, and the domestic players should look at collaborating with companies from Switzerland, which has expertise in machine making.
The European Free Trade Association (EFTA) members are Iceland, Liechtenstein, Norway, and Switzerland.
As part of this agreement, EFTA members have committed to invest USD 100 billion in 15 years.
Many of the companies from these countries want to invest in India, domestic auto firms need to collaborate with them, the minister said.
In fact, many of the free trade agreements (FTAs), which India is negotiating will open doors for the sector, he added.
He also urged the industry to scale up production of components for electric vehicles as huge opportunities are there, otherwise, other countries will enter and capture markets.
He added that there is potential to tap into the opportunities in regions like South East Asia, Africa, Latin America, and the Middle East.
“Make a five-year action plan on how we are going to move to EVs,” he said.
Hailing the competitiveness of the auto component industry, he said the sector never seeks protection in any free trade agreement if they are getting equal market access.
In precision tools also, he said India should be self-reliant.
In FTA negotiations, talks revolve around 200-250 sectors but one segment that stands out is the auto component, he said, adding that they “say that you (government) can give any concession to any country in the world, we have no problem in competing as long as we get access into those markets. That is the confidence of the industry”.
India’s auto component exports stood at over USD 21 billion and there is a target to take this to USD 100 billion by 2030.
When asked about the announcement of the 8th Pay Commission, the minister said the move would help about 50 lakh government employees and 65 lakh pensioners.
Prime Minister Narendra Modi on Thursday approved setting up the 8th Pay Commission to revise salaries of central government employees and allowances of pensioners.
