In is quite positive. The leading domestic firms have

In India, since
1992-93 the manufacturing sector has grown at the rate of 6.9 per cent per
annum, though there has been a substantial variation in its growth rate. The
increase in the exports of automobile sector is also due to the adaptation of
international norms. After a temporary slump during 1998- 99 and 1999-2000,
such exports recorded robust growth rates in last few years. Investment is also
a major factor for this growth of Indian automotive industry, with investment
exceeding US$ 11.11 billion, the turnover of the automobile industry exceeded
US$ 13.22 billion in 2002-03. The industry produced a total of 23,366,246
vehicles including passenger vehicles, commercial vehicles, three wheelers and
two wheelers in April-March 2015 as against 21,500,165 in April-March 2014,
registering a growth of 8.68 percent over the same period last year.


Today, the
automobile sector has emerged as a sunrise sector. Nevertheless, the
overcapacity problem of production where too much capital expenditure was done
for a still growing market is haunting many of the players as demand may not go
up significantly. Hence, many manufacturers are looking for an export market
for Indian automobiles. The possibility of ancillary industry is quite
positive. The leading domestic firms have established over 200 technical collaboration
agreements with foreign firms to be able to reach international standards in
cost and manufacturing both.

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The automobiles sector
categorised in four different segments which are as follows:

Two-wheelers – These comprise of mopeds, scooters, motorcycles and electric

Passenger Vehicles – These include passenger cars, utility vehicles and multi-purpose

Commercial Vehicles – These consist of light and medium-heavy vehicles

Three Wheelers – These are passenger carriers and goods carriers.

The automobile industry is
one of the key factors that boosts the economic growth of the country. Since
the de-licensing and liberalisation of the sector in 1991 and the consequent
opening up of 100 percent FDI through automatic route, Indian automobile sector
has come a long way. Today, almost every global automobile major has set up
facilities/manufacturing in the country.