The government wants the automobile industry to play a key role in the country?s overall growth and improving its position in the world market as a manufacturing base. The industry has moved up the ladder in terms of quality standards and its recognition in the world, but needs some reforms.
Talking to reporters at the inaugural function of the Auto Expo here on Wednesday, Kamal Nath, minister of road transport & highways, said: ?We need to bring in some reforms for this industry. The Vehicle?s Act 1988 needs reforms and should speak for the requirements of today.?
He said the government would make public the draft amendments to the Act within a month and would invite comments from stakeholders. Road safety is a problem which needs to be addressed both by the industry and the government, he added.
?We will align our rules for road safety with international standards. Road accidents are taking place in India every minute and the fatal ones in every four-and-a half minutes. This is not acceptable,? he said.
Talking about the inadequate infrastructure, Nath said, ?We are committed to bridge this gap. At the heart of the infrastructure deficit is the roads and highways sector. We will build 7,000 km of roads every year, for which the works-in-progress need to be 20,000 km, which translates into Rs 2 lakh crore worth of work.?
Heavy industries and public enterprises minister Vilasrao Deshmukh said the government is taking various initiatives to promote the automobile industry, which accounts for about 15% of the country?s gross domestic product. ?Key steps, including technology fund for the industry, adoption of cleaner fuel and filling in the skill gap are being taken.? The industry expects a slew of incentives for the technological aspects, like electric and hybrid vehicles, in the next Budget. At present, the industry?s contribution to the GDPis much lower than some smaller economies like Thailand, where it stands at 40%. The industry is expected to double itself from 1.5 million units at present to 3 million units by 2016.
Said CII president Venu Srinivasan, ?There is huge potential in this country but the major challenge is to improve infrastructure.? He added that the auto industry will be creating 100 million jobs in coming years. Further, the goods and services tax (GST) will ?create a unified market at a lower cost?.
Pawan Goenka, president, Siam, said, ?The investment of the industry in the last three years is seen at around Rs 40,000 crore. It is expected to witness a CAGR growth of 16%.? The Auto Expo will see 100 new vehicles and there are at least 15 companies showcasing hybrids and electric vehicles.