Govt urges auto parts makers to hike localisation to 100%
NEW DELHI: Union minister Nitin Gadkari on Thursday asked automobile manufacturers to hike localisation of components to 100% or else the government will think of increasing basic customs duty on imported items, but the auto industry wants support for localisation of electronic parts, specially semiconductors.
Speaking at an event organised by the Automotive Components Manufacturers Association of India (Acma), Gadkari, minister of road transport and highways, said the present level of localisation of parts in the Indian auto sector is around 70% and “at any cost we need to stop imports of auto components”.
“I urge both vehicle and auto component manufacturers to increase localisation of components to the maximum. Not maximum, my expectation is to make it 100%. We are fully competent in all the things. Even, I am requesting automobile manufacturing companies to take it very seriously otherwise for imports of components we will think in the direction to increase more customs duty on that,” he said.
Stating that the Indian component manufacturers are fully competent and should be given chance to fully supply the required parts, Gadkari said,” So, presently my request to all of you is that at any cost we need to stop imports of auto components... This is the time for the Indian auto industry to support Make in India and Made in India movement.” Reiterating that the auto sector is a key driver of the Indian economy and top contributor among the manufacturing sector, the minister said increase in basic customs duty on select auto components will encourage local manufacturing of such items.” The government has always had a clear policy that we want to encourage Make in India and Made in India,” he said. Earlier in the day, Society of Indian Automobile Manufacturers (Siam) president Kenichi Ayukawa, while speaking at the same event, sought government support for localisation of electronic components, specially semiconductors, which are currently facing a global shortage, stating it would need huge investments.
Ayukawa said Siam and Automotive Components Manufacturers Association of India (Acma) are working together on a road map for ‘Aaatmanirbhar’ for more localisation of components. “Together we have identified specific areas of engine transmission, electrical tooling, grade of steel etc. that have good scope for localisation,” he said.