India poised to become global hub for European carmakers

India is positioned to become a global hub for automobile manufacturing, with Commerce and Industry Minister Piyush Goyal stating that European carmakers will increasingly prefer to manufacture in India. Goyal attributed this shift to the high cost of production in Europe, driven by what he described as ‘crazy regulations’ that make it difficult for manufacturers to remain competitive within the region.

India has already implemented quota-based tariff concessions for the United Kingdom, with a pact operationalized in July. A similar deal with the European Union is expected to be signed by the end of the year. Goyal noted that while current import quotas largely cover luxury vehicles, the lower-priced segment remains largely unopened.

To illustrate the benefits of manufacturing in India, Goyal cited Tata Motors, noting that the company achieved profitability after re-engineering and shifting models to India following its acquisition of Jaguar. He also highlighted the potential for increased investment in domestic manufacturing for electronics and semiconductors as market demand grows.