The automotive component industries in both India and the United States are well positioned to grow following the signing of the bilateral trade agreement, according to Vinnie Mehta, Director General of the Automotive Component Manufacturers Association of India.
Speaking to Autocar Professional at Automechanika 2026, Mehta said the agreement comes at an important time for the global automotive supply chain, particularly as high tariff regimes had begun to strain competitiveness in the US market.
He noted that tariffs on auto components imported into the US had risen sharply from historically low levels of around 0 to 1.5 percent to as high as 15 to 25 percent for several products. Such increases, Mehta said, were difficult for the industry to absorb, squeezing margins for component manufacturers, vehicle makers and, ultimately, consumers.
ACMA’s Vinnie Mehta added that while much of the world is negotiating tariff terms with the US, India has moved ahead by signing a bilateral trade agreement. Unlike tariff-only negotiations, he said, bilateral agreements provide a broader framework by addressing investment, intellectual property and the movement of people, creating a more stable environment for long-term industry growth.
From an Indian standpoint, both the US and the European Union remain critical export markets, with the auto component sector exporting close to 30 percent of its total production. Mehta said trade agreements with major global economies are essential not only for market access but also for deeper technology collaboration.
He also highlighted the structural shift underway in the industry, with component manufacturers increasingly evolving into technology-led players, positioning India as a stronger participant in the global automotive and mobility ecosystem.
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