The shackles have been broken, the potential is being exploited and manufacturing in India is reaping the many benefits that the country has to offer. The India advantage in manufacturing has proved a magnet for some of the biggest names in the business, among them GE Corporation, General Motors, Ford Motor Company, Honda Motors, Toyota Motors, DiamlerChrysler, Nissan-Renault, VW Group, who have set up production units here.

The reasons for India's emergence as a top-drawer manufacturing destination are obvious: robust economic growth and the promise of more, a stable political system, a strong legal and accounting framework, a tremendous pool of engineering talent, mature capabilities, a sturdy capital goods base, low overall costs and the proliferation of the English language.

A recent joint study by the Confederation of Indian Industry and McKinsey contends that India is all set to capitalise on a historical opportunity that skill-intensive industries, such as auto components and pharmaceuticals in particular, provide. The report makes it clear that India's competitive advantage in varied sectors goes way beyond a low wage structure.

An established raw materials base and growing domestic demand are further factors that endow India with significant advantages. Its geographical and strategic positioning in the South Asia region makes it a unique manufacturing and marketing hub. The range of machinery produced in India is wide, and Indian companies have a proven track record of handling large projects in the country and abroad.

Though a good amount of media coverage - and investment - is being focused on India's IT sector, most of the big bets are being placed on the traditional Manufacturing sector. According to various sources FDI figures towards are gradually Increasing and is expected to cross $ 11 Billion in the year 2006 - 07, from nearly $ 8 billion is the last year mainly in areas of infrastructure, manufacturing and IT. This has placed on an enviable 4th largest FDI destination in Asia.

Automobiles and Auto Components are two of the most dynamic manufacturing sectors in India. The country's auto-component companies have shown that they are well positioned in terms of skills, price and quality to cater to global supply chains. Various global automotive OEM's are using India's skill and low cost advantage, as a sourcing platform for various components and automotive parts. Others such as Fiat, Toyota, Honda, General Motors, Ford, DiamlerChrysler, Hyundai, Skoda Auto & Suzuki have already established their manufacturing presence here and are expanding capacities and introducing models at an accelerated pace.
The country today boasts of 12 Commercial & Utility Vehicle Manufacturers, 12 Tractor Manufacturers, 11 Passenger Car Manufacturers, 10 wo wheeler manufacturers, 3 Three wheeler Manufacturers and nearly 7 Earth Moving Equipment Manufacturers.

India's automotive industry recorded an growth rate of about 7 per cent in 2005-06, down from the higher growth rates in the prior years. Though Passenger Vehicles grew at 8 percent, Commercial Vehicles at around 10 percent, 2 Wheelers around 14 percent, and Tractors grew at 33 percent. Overall the auto industry in bullish about India and confidence in the market seems to grow stronger.

The Indian auto-components industry is well positioned in terms of diversification, skills, price and quality to cater to global supply chains. Approvals for foreign direct investments in the industry are automatic and exports from the country are exempt from tax. The industry already exports close to 50 per cent of its production and is aiming at reaching much greater heights.

Simply put, having come of age and found its feet, manufacturing in India has secured its place in the global sun. The time to cash in has arrived.

For more information:

	SIAM (Society of Indian Automobile Manufacturers)
	ACMA (Auto Component Manufacturers Association)
	CII (Confederation of Indian Industries)