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European OEMs may use FTA access to test India market before localising production: Goyal

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European OEMs may use FTA access to test India market before localising production: Goyal

European OEMs may use FTA access to test India market before localising production: Goyal

The proposed approach would allow carmakers to identify models with demand in India before setting up local production, with the country also offering scale for global exports, the Union Minister said.

European automakers may initially evaluate the Indian market by shipping approximately 5,000 units of various models before considering local production , Union Minister Piyush Goyal said on Tuesday, adding that OEMs plan to leverage India as a manufacturing base. This might be the go-to approach for European OEMs as the two sides finalised the free trade agreement , which is expected to be officially signed in December this year. The FTA might provide European automakers higher access to the Indian market while opening up possibilities for Indian manufacturers in Europe. Advt

"When we negotiated the FTA, we of course gave them an opportunity to sell their cars to India. But when I engage with the auto industry of Europe, they recognise that what we need market access in India is only to test the market," Commerce and Industry Minister Goyal said during Bharat Mobility Curtain Raiser. European automakers believe access to the Indian market through the FTA provides an opportunity to assess consumer demand before committing to manufacturing investments. “Maybe we (EU) will send five models and see which one has an appetite in India. Once we finalise what has appetite in India, then we will bring that car manufacturing to India and not only for India, but for the world, because economies of scale will play out,” he added.


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