Impact Of Indian Automobile Industry In The World

India, with its steady progress in economy, has quietly dismissed the notion of third world country, and emerged as one of the powerful economic nations in the world. Along with other industries, Indian automotive sector has experienced a huge boost in the last two decades. To understand the growing impact of Indian automobile industry in the global business arena, we must first analysis the past and current scenario of Indian automobile industry, automobile supplier and export percentage.
In the past decade, India has witnessed a scintillating growth in automobile industry and bagged the position of seventh largest in the world. Every year, the country manufactures over 17.5 million vehicles and export about 2.33 million to different parts of the world. It has earned the acclaimed position of world’s second biggest producer of motorcycles. According to a recent report, India is set to outshine Brazil to hail as the world’s sixth largest passenger vehicle producer. Moreover, India export market has also been exponentially growing, just behind some traditional automotive countries such as Japan, South Korea and Thailand.
Indian automobile industry has come a long way to reach the present growth, and undoubtedly it has created a deep impression in global market. After economic liberalization in 90s, Indian indigenous automotive companies such as TATA Motors, Maruti Suzuki and Mahindra and Mahindra inflated to great extend and increased its export operations. In 2000, Indian had earned the reputation of being the second largest two wheeler market in the world, fourth largest commercial vehicle market in the world, and eleventh largest passenger car market in the world.
The growth of Indian automobile industry has not only positively affected Indian economy, but also created an exceptional opportunity for foreign automobile companies. Well, we know India provides trained manpower at a cheap rate, which is indeed a lucrative proposition for many foreign companies to establish their manufacturing hub in the country. As a result when many other parts of the world see a slump, India is enviably growing in this sector.
Indian And International Automobile Trade Analysis
In 1991, a new era of automotive had augment when Indian government started its de-licensing of the sector and opened 100% foreign direct investment in the market. The opportunity was quickly grabbed by major global automotive players and soon the country had witnessed a stooping growth 30% per year for the last seven years. The export earning has also increased, over USD 6 billion.
Ironically, Indian automotive industry’s contribution in global terms is poor in spite its rapid growth. Indian share is about 3.28% of world production of passenger and commercial vehicles, which is very low. The global trade is also not inspiring, as India’s automotive exports constitute only 0.3% of world’s business.