NEW DELHI: Niti Aayog CEO Amitabh Kant on Thursday urged that automakers and components industry to put an end to its import dependence on China for a host of automotive parts and rather develop those items within India.
“It is important that certain automotive components, which are being imported from China purely on the back of cost competitiveness and development capabilities, be manufactured here...We should not become a major importing nation in electric-vehicle components like we’ve done in solar,” said Kant while speaking at the 61st annual session of Automotive Component Manufacturers Association.
Kant said India is dependent on China for semiconductor-based components and other electrical parts for EVs and this should not only be minimised but eliminated. To note, a large portion of India’s lithium ion battery needs are also imported from China.
According to ACMA data, import of components into India fell 11% to Rs 1.02 lakh crore in FY21. China’s share in auto component imports, however, went up 29% in FY21 compared to 26% in FY20.
Speaking on electric vehicles, Kant said that electric four-wheelers will also be considered for incentives under the FAME II scheme, once there is 100% saturation of electric buses in the nine cities selected under the programme. He also warned that a sharp rise in the number of EV start-ups (such as Ola and Ather) may disrupt the traditional business model of large established players if they refuse to switch to EV mobility soon.
Kant’s statement comes a day after Maruti Suzuki chairman RC Bhargava had said that only strong statements are made (by government and policymakers) to reverse declining sales but no concrete actions is visible on the ground. Bhargava had also said that his company will start making EVs when it is affordable for consumers to own one.
Hyundai Motor India MD and CEO SS Kim said that there is a need to develop an alternate and localised supply chain to mitigate the impact of disruption and push localisation. He added that this strategy will ensure a greater level of competence and stability for the entire industry in India and for our export operations
Auto lobbying body SIAM President Kenichi Ayukawa said that semiconductor shortage is a big challenge but the situation could also turn out to be a big opportunity for the domestic auto component manufacturing industry.