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Informist, Wednesday, Sept. 2, 2026

NEW DELHI – With strong growth in the domestic component market, automakers aim to diversify component sourcing. "...external disruptions also mean we need to have diversified sourcing for many of the key components." R. Mukundan, the president of Confederation of Indian Industries, and the managing director and chief executive officer of Tata Chemicals Ltd., said at the 66th Annual Session of the Automotive Component Manufacturers Association of India on Tuesday. "...we knew that our dependency on Middle East (West Asia) was extremely high." he added.

Mukundan emphasised that component makers should set up manufacturing assets and build relationships internationally to move the industry forward. Giving an example, he said, many Indian companies have globalised operations, increased exports, and have set up overseas bases. The component makers should invest to expand overseas to get access to markets, talent, capabilities, and enablement to integrate with global automotive value chain, he added. 

The automotive component industry in India has moved up the value chain in growth, according to Mukundan. Indian manufacturers are now supplying systems, sub-systems and are increasingly taking greater responsibility for design and development and co-existence with original equipment manufacturers. "...it is increasingly becoming not just a vendor-supplier relationship, but also a technology and development partnership," he said, adding, "it is an important piece of the transformation which we need to pull ahead and move forward."

Mukundan reiterated prime minister's view of becoming vocal for local to localise technologies. He also noted that currently the automakers and equipment manufacturers depend on northern neighbour, and, hence, there is a need to set up a value chain in India.

Highlighting the production-linked incentives in the country, Mukundan said, "...it is extremely critical and working with the ministry, working with the OEMs (original equipment manufacturers) to build that capability here (in India) will enable the ecosystem to come here." The capacity building will help the tier two and tier three suppliers and micro, small, and medium enterprises as well, he said. Manufacturers should move forward with responsible sourcing, traceability, and lower carbon intensity.

While external disruptions may affect the industry, manufacturers were suggested to diversify sourcing of key components, especially in the automotive component sector, which is highly dependent on West Asia. Having a strong domestic base will help the country confront such external disruptions better, Mukundan said. "We are looking at sources beyond Middle East. And it's not just one sector, one location now. We need to diversify into multiple places."

Auto component industry has an opportunity to use its scale, talent, entrepreneurship, and manufacturing capability as strengths and move further in its journey towards global competitiveness, supplying all over the world.  End

Reported by Pratyush Kumar, Devanshu Singla, and Anand JC

Edited by Deepshikha Bhardwaj

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