Mahendra Nath Pandey also urged the industry to increase investment in R&D activities especially for the EV sector and invest in upskilling the workforce.

Union Minister Mahendra Nath Pandey on Thursday asked the domestic auto component industry to take measures to implement localisation initiatives on the ground and enhance investments in R&D activities.

The heavy industries minister, speaking at the annual session of the ACMA (Automotive Component Manufacturers Association, also asked the companies to invest in upskilling the workforce.

“PM Modi’s vision is vocal for local and I know the industry is working on the localisation process. In this regard, SIAM and ACMA have come out with a localisation road map and I request the industry to implement it on the ground,” Pandey said.

The minister also urged the industry to increase investment in R&D activities especially for the EV sector and invest in upskilling the workforce.

Elaborating on the various schemes, Pandey said the government has rolled out PLI scheme for batteries as well as the auto and auto component sectors with an outlay of Rs 18,100 crore and Rs 97,000 crore, respectively.

The government has also brought the FAME II scheme with an outlay of Rs 10,000 crore, he added.

“Around 7,090 electric-buses, 5 lakh electric three-wheelers, 55,000 electric four-wheelers and 10 lakh electric two-wheelers are to be supported under this scheme. This is a very ambitious plan for a country like India,” Pandey stated.

The idea is to reduce the carbon footprint as much as possible and the government has also formulated a plan to popularise hydrogen and electric vehicles in this regard, he noted.

Lauding the industry, Pandey said the sector currently generates 2.3 per cent of the country’s GDP, while giving employment to over 50 lakh people.

He noted that 60 per cent of the auto component exports from India currently go to North America and Europe.

“We have set a target of doubling the exports to USD 30 billion in the next five years by 2025-26. It would enhance the Indian auto component industry’s share in the global business to over 3 per cent,” Pandey said.

The employment figure in the sector is also expected to go up to 70 lakh by 2025, he added.

The automotive exports stood at around USD 13 billion in FY21 and currently account for just 1.2 per cent of the global component trade, which stands at around USD 1.3 trillion.

ACMA represents over 800 manufacturers who contribute more than 85 per cent of the auto component industry’s turnover in the organised sector.