Speaking at the ASSOCHAM summit on ‘2nd Auto Forum & Awards 2017’, Dattatreya said that the government recognises the importance of skilling the workforce and has allocated Rs. 16,000 crore for the same. Dattatreya also feels that Industry should focus more on social security of employees to increase productivity.
The Union government is going to amalgamate, simplify and rationalise into four labour courses out of 44 existing labour laws and also plans to create 65 million jobs by 2026. Union Labour and Employment Minister Bandaru Dattatreya on Thursday said at an ASSOCHAM event held in New Delhi.
“The Original Equipment Manufacturer (OEM) needs to make substantial investments in engineering and Research and Development for designing and developing in India, so that India graduates to a truly Auto Engineering hub rather than continue to be a place of prints manufacturing,” said Girish Shankar, Secretary, Ministry of Heavy Industries & Public Enterprises during the same summit.
He also explained that there is a huge gap, which the auto industry must address to ensure that ‘Make in India’ is really creating and developing in India.
He further requested the auto majors to consider this seriously and quickly. He even agreed to take suggestions on as to how to support this through an appropriate policy framework, claiming that they are already working towards this direction.
Shankar further added that Department of heavy industries being the administrative ministry for the automotive industry has the onus of leading and steering the policy alignment for the industry to meet the expectations towards Green Mobility in India.
He added that they have finalised the net automotive mission plan (AMP) 2016-2026 which is a combined effort of the government of India and the industry to chart a growth path that we jointly seek to achieve.
It also seeks to define the trajectory of evolution of the automotive ecosystem in India including the glide path of specific regulations and policies that govern a wide range of parameters that affect the industry.
“As an outcome of the AMP 2026, the Ministry expects that Indian Automotive industry will grow three point five to four times in value from its current output of around Rs. 4,64,000 crore in 2015 to about Rs. 16,16,000- 18,89,500 crore by 2026 considering an average GDP growth ranging between 5.8 percent to 7.5 percent during the period,” said Girish Shankar.
The Auto industry generates demand for the rest of the manufacturing sector. Being the leading sector for overall economic growth, this sector is crucial for the ‘Make in India’ programme, with the target of an annual production of Rs.16 to 19 lakh crore in terms of its size and to establish itself firmly on the global stage.
By 2026 India could stand first in the world in terms of production and sale of small cars two wheelers, three wheelers and buses, third in passenger vehicle and heavy trucks all adding up to 12 percent of GDP.
Exports of the automotive vehicles which were at the level of Rs 62,500 crore in 2015, is targeted to go up to Rs 2, 23,300 crores by 2026. Besides, it would also be a key player in ‘Skill India’ programme, targeting an additional of 65 million jobs, told Shankar.
The government of India plans to introduce a new Green Urban Transport Scheme with a central assistance of about Rs 25,000 crore aimed at boosting the growth of urban transport along low carbon path for substantial reduction in pollution and providing a framework for funding urban mobility projects at National, State and City level with minimum recourse to budgetary allocation support by encouraging innovative financing projects.
R S Kalsi, Chairman, Auto Council ASSOCHAM, thanked the government for being considerate to the needs of industry and cited “path breaking efforts in highway development, progressive regulations and tax reforms” as major positives.
Kalsi assured that the industry was fully committed to “Greening India” and that the increase in taxation on hybrid cars under Goods and Services tax (GST) has, “surprised automobile manufacturers as well as the component industry”.
He drew attention towards the National Electric Mobility Mission Plan 2020, and said in response to the government’s call that industry had invested in hybrid technologies and was now planning to “step up investment and bring newer products”.
Emphasising the close connection between electric and hybrid technology, Kalsi added that the key components such as electric motor and lithium ion battery are common to clean technologies.
Encouraging hybrid technology now, which is relatively less expensive and does not require charging infrastructure, will lead to localization of parts and reduction in cost, thus helping build the eco system for electric mobility in India.