Auto Industry Optimistic Amid GST Boost and FTA Prospects, Raises Rare Earth Concerns

On Friday, leaders of the auto component industry expressed optimism at the Automotive Component Manufacturers Association of India's annual event, noting recent GST rationalisation and the ongoing free trade agreements (FTAs) as positive developments. However, they also voiced concerns regarding rare earth shortages and product development delays.

Vivek Vikram Singh, Managing Director and Group CEO of Sona Comstar, highlighted the need for the Indian government to engage with China to mitigate rare earth supply constraints. "An interim solution using rare-earth-free magnets is suboptimal and impacts both our operations and customers," Singh told ANI.

While celebrating the GST rate cuts as a "boon" for the industry, Singh stressed the importance of the India-EU FTA, dubbing it a significant opportunity for India's auto sector. Other industry figures echoed these sentiments on FTAs and potential new markets, despite current challenges such as US tariffs and supply chain issues.

(With inputs from agencies.)