A sound transportation system plays a pivotal role in the country's rapid economic and industrial development. The well developed Indian automotive industry, with deep forward and backward linkages, ably fulfils this catalytic role by producing a wide variety of vehicles passenger cars, light medium and heavy commercial vehicles, multi-utility vehicles such as jeeps, scooters motor-cycles, mopeds, three wheelers, tractors etc.

2. The automotive industry comprising of the automobile and the auto component sectors has shown great advances since delicensing and opening up of the sector to foreign Direct Investment (FDI) in 1993. The investment in the industry has now exceeded Rs. 50,000 crores. The turnover of the automobile industry including auto component industry exceeded Rs. 59,500 crore in 199-2000. The industry provides direct employment to 4.5 lakh and generates indirect employment to 4.5 lakh and generates indirect employment of 1 crore. The industry contributes to the revenues of the Government in substantive measures which in 1999-2000 was exceeding Rs. 26, 300 crores. The contribution of the automotive industry to GDP has risen from 2.77% in 1992-93 to 4% in 1998-99.

3. Since the beginning of liberalization in 1992-93 there has been spectacular growth in the industry and it achieved a cumulative annual growth rates (CAGR) of 22% between 1992-97 outstripping industrial production growth by about 30%. This has led to an increase in its contribution to industrial output from 4.3% in 1992-93 to 5.4% by 1996-97. During the period of 1992-97, the automobile component industry has grown by a CAGR of 28%. Also this period was characterized by the entry of global automobile manufacturers for setting up joint ventures in India. There has been substantial addition to installed capacity from 1993-94 to 1998-99. The installed capacity in different segments is given below.

4. The details of actual production during 2000-01 and for 2001-2002 (upto November) with the corresponding figures of year before are given below.

5. With the domestic auto industry now moving in steps with WTO covenants, the stage is set for it to make rapid strides domestically and internationally. A global recession last year not withstanding, the industry has shown appreciable resilience to the challenges of the environment. Automobile industry as a whole was able contain the decline in its growth rate to –2% in 2000-2001. However in the current year, between the period of April to November, industry has grown by an overall growth rates of 8.1% as compared to the corresponding period previous year.

6. The automobile industry is also contributing to exports of the country. The details of export during 2000-2001 and for 2001-2002 (upto November) are given below. (Quantity in Nos.)

7. Indian automobile industry is also consistently trying to meet the emerging challenges of environmental pollution and better safety standard. According to a study, automobile exhaust contributes more than 60% of the atmospheric pollution in metropolitan cities, with the growing number of vehicles, the pollution in the cities is continuously increasing. Government initiated controls by notifying emission standard from the year 1992 under which were furthers tightened in April 1996 under the Motor Vehicles Act. Euro-I emission norms have already been made applicable throughout the country and Indian is poised to induct Euro-II norms across the country by April 2005. Form that date 7 metropolitan cities are going to switch over to Euro–III norms. To meet this emerging challenges of newer emission norms Indian automobile industry has already braced itself up with new investment and fresh technological induction.

8. The growth of automobile components industry is closely linked to the growth of automotive industry as substantial quantity produced is supplied by auto components industry to original equipment manufacturers (OEMs), Keeping in line with the decline in the growth rate in the automotive as a whole, auto components industry has also registered slow growth during last 2-3 years. The production during 2000-2001 was of the order Rs. 17,174 crore compared to Rs. 16,356 crore during 1999-2000 registering growth of 5%.

9. On export front automobile component sector has registered a growth rate of 15% during 2000-2001. Total export of auto components during 2000-2001 was of the order of Rs. 1915 crore compared to Rs. 1665 crore during 1999-2000.

10. With substantial improvement in technological capabilities Indian auto component industry is slowly integrating with global supply chains bringing in tremendous export potential and possibilities of foreign exchanges earning to the country.

11. Agricultural Machinery mainly consists of Agricultural Tractors, Power Tillers, Combine Harvesters and other machinery and implements. At present, there are ten units in the organized sector manufacturing agricultural tractors covering a wide range from lower Horse Power of 50 and above.

12. The Industry made a beginning in 1961 with a total production of 880 units. The has been a substantial growth in the production of tractors since late 1980s and the production has reached a level of 2,34,575 in 2000-2001. Production figures of tractors during the last few years are given below.

13. The production of tractors in the range of 31-40 HP is around 60% in the range of 41 HP and above is 23% and below 30 HP category is 17% of the total production. Traditionally, Haryana, Punjab, and Uttar Pradesh are the main States for the tractor market. The new markets for tractors in the states of Madhya Pradesh, Andhra Pradesh, Tamilnadu, Maharashtra and Gujarat states are growing at a faster pace.

14. Earth Moving Equipment and Construction Machinery Industry play a vital role in the economic development of our country. This industry is closely linked with major development and infrastructural schemes such as coal and mineral mining, irrigation and power projects, ports, steel, fertilizers etc. The technology required to manufacture such machine was not earlier available. It was, therefore, necessary to permit import of technology for development of the same from internationally reputed manufacturers like KOMATSU, CATERPILAR, POCLAIN, DRESSER, DEMAG AND HITACHI. The earth moving equipment currently being manufactured cover shovels upto 10 cu.m. capacity, Bulldozers upto 770 HP, Dumpers upto 120 HP, Excavators upto 8.5 cu.m. capacity, Scrapper and Motor Graders upto 280 HP and walking Draglines Mobile cranes etc. Construction equipment, mainly road construction equipment such as graders, loaders, excavators, vibratory compactors, hot mix plants etc. are being manufactured indigenously. These machines help to speed up development in irrigation and power projects, coal and iron ore mining, for excavation of lime stone for cement, for development and reclamation of vast track of land building roads, making canals, preparing industrial sites and all facets of the country’s development activity. These machine also reduce dependence on labour and provide automation in construction work.

15. Indigenous production of Earth moving and Construction Machinery commenced in 1960s. Today country is by and large, self sufficient in respect of these items. In fact during the last decade, the industry has made enormous progress and has grown both in size and diversity. The total capacity available in the Earth Moving & Construction Equipment Industry is around 6000 nos. With the Government's emphasis and priority on the development of infrastructure, this group of industry is expected to grow in near future.

16. The numbers of Earth Moving and Construction Equipment manufactured during last few years is given below.