Is Increasing Local Competition Key to Strengthening India’s Automotive Sector?

Indian engineering, design and technology are fast ramping up, getting better every day. This wasn’t always the case. A sea change from what earlier started out with just proficiency in software that slowly evolved into competency in control systems and, finally, computer-aided design, Indian engineering today has come a long way. And let’s not forget, we probably produce the most engineers globally today: 1.5 million a year, if the numbers are right.

Now, yes, not all these engineers are top drawer, and the best candidates get on a flight soon after they graduate. Still, what you can’t deny is that the giant wheel of Indian engineering has started to turn; slowly at first, but increasingly faster now. 

Look around and you see the proof of this everywhere. From giant construction and infrastructure projects to space, defence, aero and, of course, the automobile industry. Think of Chandrayaan, the success of ISRO’s launch platforms, the fact that today we can build globally competitive stealth destroyers, aircraft carriers, light and heavy tanks, attack helicopters, fourth-generation combat jets and, importantly, many of the defensive and offensive missile systems used on these platforms.

Sure, there are gaps in our capabilities, big ones. But there are also areas where we are further up the road than expected. Cue the Akash surface-to-air system, our integrated air defence system, or the BrahMos supersonic missiles we have engineered with Russia.

What you will also have noticed with our homegrown auto industry is an ever-increasing ability to get to grips with cutting-edge tech. Mahindra and Tata are already operating at a level that would have been scarcely believable only a decade or so ago. And from what we are seeing, this is only the beginning. Also, for once, it seems like we could do in 10 years what took China 20. Wouldn’t that be nuts?

However, what we are lacking is sufficient local competition. This is something that has proven essential in markets around the world. Strong local competition fosters the biggest steps forward, the greatest advances. Look at the local Chinese car industry; there are at least a dozen carmakers falling over each other to get to local customers.

And tough local competition has proven to be essential in places like Germany, the US and Japan. Even ‘communist’ Russia and China understand this and have multiple design bureaus fighting it out among themselves in their defence industries.

This is something Indian authorities are finally doing today as well; they are in the process of creating competition for monoliths like ISRO, HAL, DRDO and others with the inclusion of private players. So yeah, to aid progress, we need more local players to give the Tatas and Mahindras a run for their money. After all, local competition has already started to heat up in the two-wheeler space, with the likes of Ola, Ather and Ultraviolette. Isn’t it time the car industry in India caught up?