Industry & Economy
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Economic Survey
Auto industry gets pat on the back
Our Bureau
New Delhi
,
July 7
THE Economic Survey released on Wednesday has complimented the Indian automobile industry for its success on the export front, led by a host of global automakers using India as a production base either directly or through joint ventures.
``The liberalisation of norms for foreign investment and import of technology for manufacturing of vehicles, permission of 100 per cent foreign direct investment under automatic route in this sector, have helped it to restructure, absorb new technologies and get integrated into global production chains,'' it said.
Total vehicle production grew by 15.1 per cent to 72.2 lakh units during 2003-04 over 62.7 lakh units during the previous year.
According to the Survey, the growth of passenger cars was assisted by an eight per cent reduction in production tax from 32 per cent to 24 per cent in the last budget, reductions in tariff, and improvements in the availability of retail credit.
Exports, which were a major factor for the development of the automobile industry in India, posted a massive 56 per cent growth at 4.79 lakh units during the last fiscal.
``Over the last four years the exports of automobiles (of all kinds) has grown by roughly three and a half times,'' the Survey said. The Survey pointed out that there has been an upswing in the exports of auto components with the industry's exports growing by 30.1 per cent in value terms to Rs 4,550 crore during 2003-04.
``A host of major international automobile companies are increasingly harnessing India as a production base, either directly through FDI or indirectly by contracting with firms operating in India,'' it said.
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