The government is also working on a production-linked incentive scheme for the automobile sector, which is one of the 13 identified for the government’s big manufacturing push.
Ford’s exit from India is due to operational reasons and no reflection on the country’s business environment, a top government official said.
The country’s automotive sector has seen investment of $35 billion in the past six years and a host of global players including Tesla, Kinetic Green Energy, Bahwan International Group and Nidec are evaluating India plans, he said. Yazaki, Daicel, CKD and C4V had acquired land to set up manufacturing facilities or have inked memoranda of understanding to invest in the country, he said, underlining the point that India remains an attractive destination.
“India’s automotive growth story is alive… There is growth seen both on the domestic front and export front,” said the official.
The government is also working on a production-linked incentive scheme for the automobile sector, which is one of the 13 identified for the government’s big manufacturing push. He said the sector continues to attract foreign investments and had achieved critical mass with total exports of $27 billion.
On Thursday, Ford announced the company will cease making vehicles for sale in India immediately. Manufacture for exports will wind down at the Sanand plant by the fourth quarter in 2021. The Chennai engine and vehicle assembly plants will cease operations by the second quarter of 2022.
The company had said the decision is part of Ford’s global restructuring programme but the move has raised concerns in some quarters about the country’s business environment.
The official said the global landscape in the auto sector was undergoing tremendous change with the entry of electric vehicles.