India’s auto components business, according to Commerce and Industry Minister Piyush Goyal, has generated a trade surplus of $600 million for the first time.
The minister made the remarks while speaking at the Automotive Component Manufacturers Association’s Atmanirbhar Excellence Awards and 7th Technology Summit 2022. (ACMA).
The trade surplus comes after the government boosted customs duties on several auto parts last year in an effort to stimulate domestic manufacture. The Union Budget for FY22 also proposes a 15% rise in customs duty on a number of items, including safety glass, ignition wiring sets, and signalling equipment parts, up from the current range of 7.5-10%.
Goyal went on to say that India’s merchandise exports had reached over $390 billion as of March 14 and will very probably surpass $400 billion this fiscal year.
Despite an increase in exports, India’s trade imbalance continues to grow. Due to increased crude and commodity prices, the gap between India’s merchandise exports and imports grew in February after reaching a five-month low in January.
According to figures from the Commerce Ministry, India’s merchandise exports increased by 22.36 per cent in February to $33.81 billion, while imports increased by 35 per cent to $55.01 billion, resulting in a trade deficit of $21.19 billion in February, up from $17.42 billion in January.
According to an official statement, Goyal expressed concern about chip shortages in the auto sector.
“The recently approved Semicon India Programme with a budget of ₹76,000 crores would help reduce import dependence and eventually help us become Atmanirbhar in the arena of chips,” he said.
He also urged the car sector to work on enhancing the e-mobility ecosystem, which includes fuel cell vehicles with hydrogen storage, bigger lithium-ion battery capacity at a lower cost and improved charging infrastructure.
