Prime Minister Narendra Modi on Thursday urged the automobile industry to continue innovating, pursuing excellence and proactively charting a bold pathway towards Viksit Bharat. In a message to the Society of Indian Automobile Manufacturers (SIAM) at its Annual Convention 2026, Modi said that with recent free trade agreements providing greater access to international markets, the Indian automobile sector, already recognised across many parts of the world, is well placed to further expand its global presence.
“As our economy grows, the demand for mobility is also rising. The rapid expansion of highways and other infrastructure is facilitating the movement of people and goods while creating new opportunities for the automobile industry. Better connectivity and more efficient logistics are reducing costs and making Indian manufacturing more competitive. This is strengthening the automobile sector and contributing to India's economic growth,” said Modi.
He also said that the country is taking significant strides towards a cleaner and more sustainable mobility ecosystem. He added that rapid expansion of charging infrastructure is encouraging greater adoption of electric vehicles and creating new opportunities for innovation.
“In recent years, the Government's reforms to boost ease of doing business, including the removal of redundant laws and removal of unnecessary compliances, have provided fresh impetus to industry. Initiatives such as the PLI Scheme and Make in India have further strengthened the manufacturing capabilities of the automobile industry,” said Modi.
Helped by GST rate reduction in September 2026, India’s automobile industry has seen a sharp surge in sales. The export market has also remained buoyant despite the West Asia crisis. On Wednesday, Commerce and Industry Minister Piyush Goyal had said that Indian companies should utilise the market access opened up by India's recent trade agreements. He added that nine trade agreements finalised by the government in recent years provide access to 38 developed countries with a combined GDP of around $60 trillion.
Passenger Vehicles segment recorded its highest-ever sales of 4.6 million units in FY 202526, with a growth of 7.9% over the previous year. Exports from this category also achieved their highest-ever levels, at 0.91 million units, registering a growth of 17.5% over the previous year. The Two-Wheeler segment recorded its highest-ever domestic sales of 21.71 million units in FY 2025-26 registering a growth of 10.7% over the previous year. Exports of Two wheelers registered a growth of 23.4 % in FY 2025-26 amounting to 5.18 million units.
Shailesh Chandra, President, SIAM said that the sector’s overall contribution to the Indian economy exceeded Rs 22.75 lakh crore, contributing to about 15% of the country’s GST collections.
Union Minister for Road Transport and Highways Nitin Gadkari said that India, the world’s third largest automobile market, has the scale, engineering talent, growing market and ambition to become the world's number one automobile industry. While speaking at the SIAM event, he urged the automobile industry to help the country in securing a larger share of the global automotive value chain.
Gadkari said that the government is planning to roll out a new version of the Bharat NCAP programme from October 2027, which will assess the complete safety framework and address the severe challenge of road accidents in the country. He also announced another scheme to control emissions from BS IV-compliant vehicles.
