According to a report by IANS, India’s automobile industry has emerged as a cornerstone of growth, playing a major role in GDP contribution, job creation, and export performance, as the country advances toward its $5 trillion economy target.
Industry figures for the financial year 2024–25 highlight the sector’s rising influence, with the auto industry contributing about 7.1% to the national GDP and 49% to the manufacturing GDP. It supports more than 3.7 crore jobs and contributes nearly 8% to India’s total exports, underscoring its strategic importance in the country’s economic framework.
Beyond its economic impact, the automobile sector has evolved into a symbol of India’s manufacturing strength and innovation capacity. Increased domestic demand and improved production capabilities have positioned India as the world’s third-largest automobile market by sales and the fourth-largest by production.
FY25 Manufacturing and Export Performance
In FY25, India manufactured over 31 million vehicles across various categories. This includes over 5 million passenger vehicles, 1 million commercial vehicles, 1 million three-wheelers, and nearly 24 million two-wheelers.
Automobile exports have also surged, with about 5.7 million vehicles shipped to markets including Japan, Mexico, Latin America, and Africa. This export momentum is driven by supportive government policies that encourage local manufacturing, promote clean mobility solutions, and integrate Indian manufacturers into global value chains.
Central to this strategy is the Production Linked Incentive (PLI) scheme for the automobile and auto components sector, with a total budget of ₹25,938 crore (approximately $3.1 billion). The initiative aims to accelerate the adoption of advanced automotive technologies such as electric vehicles, hydrogen-powered mobility, autonomous systems, and other next-generation transport solutions.
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