Automakers cheer India’s investment policies, market

New Delhi, January 27: | Updated: Jan 28 2002, 05:30am hrs
Unfazed by grievances from foreign companies about the country’s investment climate, auto giants like Ford, DaimlerChrysler, Fiat and Hyundai have hailed India’s investment policies, ranking it among the best in the world and expressed willingness to be the ambassadors of foreign direct investment (FDI).

Propelled by the increasing demand, these companies are augmenting their production capacity in India besides launching new vehicles, a recent survey conducted by the Confederation of Indian Industry (CII) showed.

German-US auto maker DaimlerChrysler plans to make the country an export hub for auto components which contributed Rs 160 crore to its total revenues in a year, finance and corporate affairs head Suhas Kadlaskar said.

The Pune-based company, which makes ’E’, ’S’ and ’C’ Class cars range of Mercedes cars, views the domestic market as lucrative for growth and expansion and is soon launching latest models like ’M Class’, ’SLK’ and ’SL Roadster’ models.

Daimler Chrysler manufactured 1,350 cars in 2001, which it plans to increase by 15-20 per cent this year.

Ford India vice-president (external affairs) Vinay Piparsania said the investment climate in India was very conducive and the only hurdle which the company faced was multiplicity and high rate of taxes.

The Chennai-based car maker said it has received good response to its products, selling 60,000 units of the mid-size car ’Ikon’, including exports of 25,000 units since 1996.

Fiat India director (corporate affairs) Ramesh L Adige said FDI was not only related to the investment climate but also to returns which depend largely on the population size, per capita income, purchasing power and value of the Rupee.

"Earlier, there were problems at the state levels, in implementation of projects, but now there is a perceptible change in the attitudes of state governments, and all the issues confronting Fiat were on a fast track for solution," Mr Adige said.

A spokesperson for Hyundai Motor India said it was very comfortable with the market for its cars. A subsidiary of South Korea’s Hyundai, the company made its debut in the Indian market in 1998 and makes 1.2 lakh cars annually.

Two-wheeler makers Honda Motorcycle and Scooter India (HMSI) and Yamaha Motor India are enthusiastic about the success of their respective products in the domestic market.

A subsidiary of Japan’s Honda Motor Co., HMSI has increased its sales target by 40 per cent for 2002-03 and hiked production capacity by investing Rs 100 crore, deputy manager (product planning and sales promotion) Rajiv Pruthi said.

Yamaha Motor India, which is the only 100 per cent Yamaha company in Asia, outside Japan, aims to break even this year, and make profits by next year, chief manager (marketing) Nalin Kapur said. Almost all the MNCs in the automobile industry were of the view that although the policies were really good, the pace of implementation needs to be accelerated. — PTI