The Indian automobile industry is proving to be one of the drivers for Indian economic growth. The SME sector is also strongly impacted by the flourishing Indian automobile sector. SME’s helps the automobile industry in manufactures engine parts, manufacture body & chassis parts, manufacture suspension and braking parts and manufacture drive transmission & steering parts. It has been projected that the Indian auto component industry has the potential reach a turnover level of USD 66.4 billion by 2016 and USD 113 billion by 2020.
There are immense opportunities for growth in the Indian Automobile industry and these are proving to be a boon for the SME’s. The auto component industry is growing steadily. India is emerging as one of the key auto components center in Asia and is expected to play a significant role in the global automotive supply chain in the near future. This sunrise sector has over 400 firms in the organized sector producing practically all parts and more than 10,000 firms in small unorganized sector, in tierized format. The SME’s in this sector are thus seeing immense growth prospects and bright future.
The Government policies are also supporting the sector in a positive way with the government drawing an Automotive Mission Plan 2016 (AMP 2016) that aims to make India a global automotive hub. The Automotive Mission Plan (AMP) envisages increase in production of automotive industry from the current level of Rs.169000 crore to reach Rs. 600000 crore by 2016.
The automobile segment has vast scope for growth and development in India and various factors are responsible for aiding this growth. Infrastructure and lack of institutional assistance are cited as the key hindrances to growth for these SMEs in this sector, these issues once tackled will only lead to better opportunities and development in the domain.