Growth Of India’s Automobile Sector:
India’s automobile sector under ‘Make in India’ initiative has witnessed record growth in 2023-24, with total vehicle production reaching 28 million units the sector is transforming into a global manufacturing hub, especially for Electric Vehicles (EVs).
Growth Trajectory of India’s Automobile Sector:
- The automobile industry was de-licensed in 1991, and subsequent opening up for 100% Foreign Direct Investment (FDI) via the automatic route.
- This opened doors for global manufacturers like Suzuki, Hyundai, and Honda to set up production units in India.
- Vehicle production increased from 2 million units (1991-92) to 28 million (2023-24).
- Contribution to Economy: India’s automotive industry has a USD 240 billion turnover, the sector contributes approximately 6% to India’s GDP and supports about 30 million jobs (4.2 million direct and 26.5 million indirect)
- India’s auto components industry contributes 2.3% to GDP and directly employs 1.5 million people.
- In FY24, the industry’s turnover reached Rs. 6.14 lakh crore (USD 74.1 billion), with 54% of supplies catering to domestic original equipment manufacturers and 18% to exports.
- Growing at a Compound Annual Growth Rate (CAGR) of 8.63% (FY16-FY24), exports stood at USD 21.2 billion in FY24 and are projected to reach USD 30 billion by 2026.
- Electric Vehicle Push: EV registrations crossed 4.4 million by August 2024.
- The EV market penetration stood at 6.6%.
