in India The Indian automotive components industry - Teknikföretagen

tion of the manufacturing sector to GDP by increase in output, but it will also helpgenerate more employment in the industry and sustain high growth.Development of capabilities through training and developmentIndia produces a large number of engineers second only to China in the wholeworld. India will also supply the largest amount of manpower in the world between2005 and 2010. However, human resources need to be trained to keep up with globalbest practices. Management capabilities need to be developed simultaneously tobe able to reap the benefits of a growing and skill intensive working population. 26Research and developmentR&D expenditure as a share of turnover is low in the automotive components industryranging between 0 and 1.5 per cent. In fact many of the smaller companies andsome of the bigger companies do not even have R&D facilities. Since fiscal incentiveshave not worked effectively to improve R&D infrastructure, certain other policyinterventions are being planned in this regard. 27However, proficiency in understanding technical drawings, understanding of differentglobal standards, appropriate automation, and use of Information Technology(IT) for design and development, are some of the growing capabilities of theautomotive components manufacturers. Hence, India is expected to develop intoa big R&D base for global majors, given its capabilities in the IT sector, comprehensivedomain knowledge of the industry and shifting of design centres of globalcompanies to India. 28The Government of India is taking initiatives to strengthen infrastructure for conductingR&D in the country. Setting up of National Automotive Testing and R&DInfrastructure Project (NATRIP) is one of the largest and crucial initiatives takenin the automotive industry to create a state of the art testing, validation and R&Dinfrastructure in the country. 2926) This information has been obtained from a report prepared by Morgan Stanley. See Ahya et. al (2006)27) This information has been obtained from a report prepared by ICRIER on the Indian automotive industry.See Narayanan and Vashisht (2008)28) Reference has been made to Ministry of Heavy Industries and Public Enterprises (2006b)29) Reference has been made to National Automotive Testing and R&D Infrastructure Project (June 2007) and Ministryof Heavy Industries and Public Enterprises (2008)22