A NITI Aayog report suggests that India must implement reforms to triple its automotive components exports to $60 billion in the next five years. This growth could position India as a major player in global markets, achieving a trade surplus of nearly $25 billion and increasing its share in the global value chain of auto components from 3% to 8%. Such progress is projected to generate 2-2.5 million additional large-scale employment opportunities, bringing the total direct employment in the sector to 3-4 million people.
The report outlines that realizing this vision requires strategic and focused policy initiatives in high-value automotive manufacturing. NITI Aayog proposes a production support scheme with operating expenditure support for scaling manufacturing of specific components and capital expenditure support for manufacturing tools and dyes.
The think tank also suggests non-fiscal interventions like business improvement support, encouraging joint ventures, free trade agreements, adoption of Industry 4.0, enhanced quality standards, and skilling initiatives. It emphasizes providing incentives to attract skilled foreign nationals and retain highly-skilled Indians, including measures like granting the right to purchase residence and streamlining visa processes.