Running in the top gear

India is expected to be the world's third-largest automotive market in terms of volume by 2026.

The industry currently manufactures 25 mn vehicles, of which 3.5 mn are exported. India holds a strong position in the international heavy vehicles arena as it is the largest tractor manufacturer, second largest bus manufacturer and third largest heavy trucks manufacturer in the world.

The sector attracted $ 17.9 bn FDI between April 2000 and September 2017; accounting for 5% of the total FDI inflows.

100% FDI allowed under automatic route

For further details, please refer FDI Policy

  • 7 %

    Share in India's GDP

  • 19 mn

    Employment generated

  • 40 %

    Share in global R&D

  • 4.3 %

    Share in India's exports

Tractor Industry in India

World's largest tractor manufacturer and second largest bus manufacturer

Two Wheeler Industry in India

World’s largest two-wheeler and three-wheeler manufacturer

Indian Automobile Industry

World’s third largest heavy truck manufacturer and fourth largest car manufacturer

Industry Scenario

The $ 74 bn Automobile industry is expected to reach $ 300 bn by 2026.

The industry is expected to reach 135 bn by 2020 and 300 bn by 2026 at a CAGR of 15%.

The sub-sectors contribution to the overall market in 2017-18:

  • Two-Wheeler: 81%
  • Passenger vehicles: 13%
  • Three-Wheeler: 3%
  • Commercial vehicles: 3%

India's rapidly growing five auto hubs have a significant potential to be used as a base for export to South East Asia (SEA) and Middle East and North African (MENA) regions. 

In April-March 2018, overall automobile exports increased by 16.12%. Two and Three Wheeler Segments registered a growth of 20.29% and 40.13% respectively.

Growth Drivers

  • Growing income

    3X increase in average household income from $ 6,393 in 2010 to $ 18,448 in 2020
  • 'Youngest Nation' by 2025

    India to become the youngest nation by 2025 with an average age of 25 years
  • Vehicle penetration

    Expected to reach 72 vehicles per 1000 people by 2025
  • Expanding R&D hub

    India accounts for 40% of total $ 31 bn of global engineering and R&D spend
  • Open

    Automotive Mission Plan (2016-26)

    AMP aims to propel the Indian Automotive industry to be the…

  • Open

    Charging Infrastructure Guidelines, Mini…

    To enable faster adoption of EV in India by ensuring safe, r…

  • Open

    FAME India Phase - II

    To promote faster adoption and manufacturing of Electric and…

  • Open

    Faster Adoption and Manufacturing of Hyb…

    FAME is intended to support the hybrid/electric vehicles mar…

  • Open

    National Auto Policy (Draft)

    This policy aims to increase contribution to GDP, exports an…

  • Open

    National Automotive Testing and R&D…

    It aims to create a testing, validation and R&D infrastr…

  • Open

    National Electric Mobility Mission Plan…

    To emerge as a leader in electric vehicle market globally by…

  • Open

    Phased Manufacturing Programme for Elect…

    To promote the indigenous manufacturing of EVs

Investible Projects

Investment Opportunities in Automobile

  • Projects


  • Opportunity

    $662.29 mn

  • Promoters


  • District


  • Private Projects


  • Govt. Projects



$647.78 mn

Sanand Auto Cluster Project [Ahmedabad]

State (s) Gujarat

$14.51 mn

Setting up an Automotive Manufacturing unit in Lucknow

State (s) Uttar Pradesh

Major Investors

Data on Map

  • Automobile Industry in India

Latest in Automobile


Asked Questions

  • Since the subsidy is only on a reimbursement basis, can we claim the amount from DHI and then pass it to customers?

    No, as per scheme guidelines, incentive will be on reimbursement basis only after submission of claim. This claim required to be submitted only after sale of vehicles.

    For more information, please visit the following link. 


  • Which electric vehicles categories are not covered under this FAME scheme?

    The following categories are not covered under the FAME scheme:

    a) E-Rikshaw
    b) Electric Bicycles.
    c) Vehicles used for carrying person/goods used within closed premises like factory, airport etc.
    d) Electric Chair-cars.

    All those vehicles, which are not directly reducing fossil fuel, are not covered under FAME India Scheme.

    For more information, please visit the following link.

  • Are Electric and Hybrid Vehicles available in the market are safe to drive?

    Demand incentive under FAME India scheme is available only to vehicles that are regulated by the Central Motor Vehicle Rules (CMVR) and meet other qualifying criteria laid out in the FAME scheme. As such these vehicles meet all the safety regulations as applicable in the country.

    For more information, please visit the following link.

  • Is it necessary to sold sell old gasoline based vehicles to get subsidy under FAME India Scheme?

    No, there is no such condition in the present guidelines.

    For more information, please visit the following link.

  • It is said that Electric Vehicles (EV) are also called as Emission Elsewhere Vehicle (EEV). Is it true that EVs are just transferring emission from city area to the place where power is being generated?

    The fact is that a typical conventional hatchback has 130-140 gm/km of CO2 emission comparing to an electric vehicle for 100 gm/km when charged by grid and when solar charged, there is ~0 gm/km CO2 emission from an electric vehicle.
    Please visit the link for more information.

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