Automobiles

The automobile industry in India is world’s fourth largest, with the country currently being the world's fourth largest manufacturer of cars and seventh largest manufacturer of commercial vehicles in 2018. Indian automotive industry (including component manufacturing) is expected to reach Rs 16.16-18.18 trillion (US$ 251.4-282.8 billion) by 2026. Two-wheelers dominate the industry and made up 81 per cent share in the domestic automobile sales in FY19. Domestic automobiles sales increased at 6.71 per cent CAGR between FY13-19 with 26.27 million vehicles getting sold in FY19. Domestic automobile production increased at 6.96 per cent CAGR between FY13-19 with 30.92 million vehicles manufactured in the country in FY19. Overall automobile exports increased by 14.50 per cent year-on-year in FY19 and during April-December 2019, overall export increased by 3.9 per cent. It is expected to grow at a CAGR of 3.05 per cent during 2016-2026. The Ministry of Heavy Industries, Government of India has shortlisted 11 cities in the country for introduction of electric vehicles (EVs) in their public transport systems under the FAME (Faster Adoption and Manufacturing of (Hybrid) and Electric Vehicles in India) scheme. The government will also set up incubation centre for start-ups working in electric vehicles space. In February 2019, the Government of India approved the FAME-II scheme with a fund requirement of INR 10,000 crore (USD 1.39 billion) for FY20-22. The Government of India encourages foreign investment in the automobile sector and allows 100 percent FDI under the automatic route. In order to keep up with the growing demand, several auto makers have started investing heavily in various segments of the industry during the last few months. The industry has attracted Foreign Direct Investment (FDI) worth US$ 22.35 billion during the period April 2000 to June 2019, according to data released by Department for Promotion of Industry and Internal Trade (DPIIT)

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