State governments need to realise their role in promoting manufacturing in auto sector: RC Bhargava

Maruti Suzuki Chairman R C Bhargava said state governments should adopt measures to ensure industrial development and wealth creation to help revive demand in the local automobile market which has been in the midst of a prolonged slowdown for the past one year.

Addressing shareholders at the 38th Annual General Meeting (AGM) of Maruti Suzuki, Bhargava said the slowdown being witnessed currently is different from those seen previously as the amid this downturn when the affordability of middle-class consumers have been impacted severely, the cost of purchasing a car has gone up significantly due to implementation of upgraded safety and emission standards.

Bhargava said, “Past few months; even when the slowdown had started last year; nine states increased road taxes sharply. This has affected affordability of consumers as the average per capita income of customers here are much lower than that in China....The automobile sector creates jobs, generated revenues, states should realise all of this gets affected when the industry falls.”


Bhargava added it is not the job of the central government alone to ensure growth of manufacturing sector in the country, state governments should come forward and take measures to ensure industrial development. The automobile industry in India contributes as much as 49% to the manufacturing GDP and employs 37 million people, directly and indirectly.