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Focus on R&D to be global hub, auto sector urged

Agencies | January 15, 2004 12:53 IST

The Indian automotive industry must focus on R&D to make more original equipment manufacturers around the world to want to use India as a platform for outsourcing as well as a global R&D hub, said Deputy Prime Minister L K Advani while inaugurating the 7th Auto Expo 2004 in New Delhi on Thursday.

Advani urged the Indian auto-component industry to partner not only Indian auto manufacturers but global OEMs as well.

He said that the global rush towards lower costs component outsourcing provides Indian with a window of opportunity like never before.

The Confederation of Indian Industry, the Auto Component Manufacturers Association, and the Society of Indian Auto Manufacturers are jointly inaugurating the Auto Expo.

He said that he was 'confident that with continued commitment to total quality management and investment in R&D, the auto component sector will be able to build on its inherent strength, take on global competition, and realise the ambition of building Indian MNCs.'

He stated that India was committed to participating in free trade arrangements with several countries and regions. SAFTA, the India-ASEAN Free Trade agreement, the India-Thailand FTA must all be reviewed as an opportunity for Indian automotive industry to become truly global players, Advani added.

He urged the industry to "Go out, invest boldly and grasp global business opportunity."

He said that the automotive industry anywhere in the world has been a key indicator of economic development. Indeed, he said, mobility was something which every individual craves for and people seek access to convenient modes of transportation, and it is here that the automotive industry plays a meaningful role.

He said that as the Indian economy has grown strongly, there has been a corresponding demand for automotive products from the personalised two-wheelers to multi-axle goods and people carriers.

He said the government has a role to play in the success of the automotive industry. But the government wants the industry to play an even more effective role in facilitating the further development of the Indian economy, he said.

He called for more synergy between the government and private sector and attributed the feel good factor to this synergy.

He said that if the government and the private sector synergise more, the feel good factor can be turned to a 'feel great factor,' he said.

Jagdish Khattar, President, SIAM, in his remarks, appreciated the policy of the government of systematically bringing down the customs and excise duties. He also lauded the government for increasing investments in the infrastructure sector, which he said would greatly help the auto sector.

He said that the auto industry has many challenges, one of which is to increase the penetration level. He said that India has only six cars per thousand people, which is one of the lowest rates in the world. On the two-wheeler front, it is only 28 two-wheelers per thousand people, he said.

Khattar added that the auto industry had great opportunity for growth and income generation, given the background.

Subodh Bhargava, past president, CII, in his welcome address, said that the government's commitment to acceleration of reforms has been the key to the feel good factor.

He said that Auto Expo 2004 would show case the best of Indian auto industry.

K V Shetty, president, ACMA, said that the auto segment is on a new high with exports expected to touch $1 billion this year. He said that it was important for the industry and the government to join hands and project India's competitiveness. He said that the automobile industry of India was now a global face.


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