Automakers Should Invest In R&D for World-Class Industry, Says CEA

Chief Economic Advisor V Anantha Nageswaran urged automobile manufacturers on Tuesday to increase their investment in research and development to build a world-class industry. 

Speaking at the SIAM Annual Convention, he emphasised the need for improving global New Car Assessment Programme ratings to boost exports.

Nageswaran highlighted that the Indian private sector contributes roughly one-third of the country’s overall R&D spending, while the government accounts for the remaining two-thirds. He added that the issue is not a lack of government support but the need for companies to adopt a long-term view of R&D as an investment rather than a cost.

He added that enhancing R&D investment is crucial to India's self-reliance initiative, which aims to position Indian manufacturing on the global stage. He also advised auto manufacturers to view public mobility as complement rather than competition.

On the Indian economy, Nageswaran said it is performing well amid global uncertainty, crediting robust corporate and financial sector balance sheets and significant infrastructure investments over the past decade. 

He projected the country’s potential economic growth at 6.5-7%, with the possibility of reaching 7-7.5% through sustained reforms, particularly at the state and local levels. Achieving 8% growth, he noted, would also depend on favourable global economic conditions.

(With text inputs from PTI.)