Javadekar also added that the government will also make an announcement on the long pending scrappage policy soon.
But at the same time there is the pandemic situation, and so how long this ongoing pent-up demand would sustain is a big question, he added.
The ICRA estimates domestic demand to decline by 22 per cent to 25 per cent in FY2021 as multiple lockdown extensions have a direct bearing on the economic environment and consumer sentiments
At the end of the June many companies indicated utilisation touching 70-90 per cent of pre-COVID level.
The auto industry in India has started to de-risk itself and is working on deep-localisation, he said, adding that the recent standoff between India and China will only hasten the process.
It is also re-examining its outlook for other international subsidiaries and joint ventures.
The reduction in research and development activities may impact progress made in the alternative fuel technologies till now, the report noted.
Government seeks suggestions from auto industry for resource mop-up; sector demands financial package
'This industry is very important for India and we have to bring it back on the wheels,' Javadekar said after the video conference with the industry leaders.
For February, Mahindra & Mahindra reported a steep 42 per cent fall in total sales year-on-year, at 32,476 units compared to 56,005 last year.
SIAM Director General Rajesh Menon it was too early to assess how much of components come from China would see disruption.
The world now accepts that electricity will be the motive power of the future, but fear that their very efficiency will result in great unemployment.
Net sales of the tyres and allied industry witnessed a growth of 2.5 per cent in Q1 FY20 as against a growth of about 10.6 per cent in Q1 FY19.
Hero MotoCorp, Bajaj Auto, TVS and Honda Motorcycles have opposed the Niti Aayog's plan to push for 100 per cent electric vehicles.
From two-wheelers to cars and heavy-duty trucks, all segments of the sector were in the red.