Goyal Urges Auto Makers to Export, Targets $1 Trillion Exports
- India sets $1 trillion export target for FY2026‑27
- Goyal calls for deeper localisation in auto sector
- Exports April‑July hit $317 billion, up from $280 billion a year earlier
- New FTAs give Indian autos better market access in EU and US
- Mahindra & Mahindra plans ₹45,000 crore capacity boost
New Delhi, September 3, 2026 – Union Commerce and Industry Minister Piyush Goyal told a packed hall of auto executives that India will chase a $1 trillion goods and services export target this fiscal year, a leap of roughly 16 percent over the previous year's performance.
He made the appeal at the 66th Society of Indian Automobile Manufacturers (SIAM) Annual Convention, a gathering that draws the CEOs of Tata Motors, Mahindra & Mahindra, Maruti Suzuki and dozens of parts suppliers.
Goyal said the auto sector must become the engine that drives the nation's export ambition, urging firms to deepen localisation, expand capacity and chase overseas orders with the same vigor they apply to the domestic market.
- Exports April‑July 2026 reached $317 billion, up from $280 billion in the same period last year, according to government data.
- The $1 trillion target translates to roughly ₹8.3 lakh crore at current exchange rates.
- India's automotive export share stood at 5.2 percent of total exports in 2025‑26.
- New trade pacts with the European Union and the United States are expected to shave tariffs on Indian cars by up to 15 percent.
- Mahindra & Mahindra announced a ₹45,000 crore investment to add 500,000 vehicle‑per‑year capacity by 2030.
"Our export goal is bold, but the auto industry has the talent, the technology and the scale to deliver," Goyal said.
Officials said the government will roll out incentive packages for firms that achieve export‑linked localisation milestones, and sources confirmed that a dedicated Export‑Ready Auto Fund will be launched by the end of the quarter.
Auto Sector's Localisation Push: Cutting Imports, Building Supply Chains
The minister's call for deeper localisation is rooted in a stark reality: India still imports roughly 40 percent of the components that go into a typical passenger car, according to a Ministry of Heavy Industries report.
That reliance inflates costs, erodes profit margins and weakens the country's export competitiveness, especially against rivals like Mexico and Thailand that boast near‑complete domestic value chains.
Goyal urged manufacturers to source more parts locally, citing the recent rise of Tier‑1 suppliers in Gujarat, Tamil Nadu and the National Capital Region.
- Domestic component share in passenger cars rose from 55 percent in 2022 to 61 percent in 2025, per industry data.
- Steel imports for auto production fell by 12 percent after the government lifted customs duties on high‑strength steel in 2024.
- The auto‑parts export basket grew to $12 billion in FY2025‑26, a 9 percent jump from the previous year.
"We cannot keep paying foreign dollars for parts we can make at home," said Anjali Sharma, senior analyst at the Centre for Automotive Research.
Sources confirmed that the government is fast‑tracking approvals for greenfield component parks in Andhra Pradesh and Karnataka, offering land at subsidised rates and fast‑track power connections.
Experts said the move will also create millions of jobs in the ancillary sector, a political win for the ruling party ahead of the 2029 general elections.
New Trade Pacts Open Doors: How FTAs Empower Auto Exports
India's export push is being turbo‑charged by a suite of fresh free‑trade agreements signed over the past 18 months with the European Union, the United States, and several ASEAN economies.
The EU‑India FTA, which came into force on July 1, 2026, cuts tariffs on fully built‑up cars from 10 percent to 5 percent and eliminates duties on most auto parts, a change that analysts say could lift EU‑bound vehicle exports by up to 20 percent.
The US‑India Trade and Investment Framework Agreement, meanwhile, promises a "fast‑track" certification process for Indian electric‑vehicle (EV) models, potentially shaving two to three years off the time needed to meet Federal Motor Vehicle Safety Standards.
- EU tariff on Indian cars reduced by 5 percentage points.
- US duty on Indian EVs lowered from 25 percent to 0 percent for models meeting the new certification pathway.
- ASEAN market access expanded, with zero‑tariff entry for three‑wheelers and two‑wheelers.
"These agreements are a game‑changer for Indian manufacturers eyeing premium markets," said Rajiv Menon, senior economist at the Indian Institute of Foreign Trade.
Officials said the Ministry of Commerce will set up a dedicated Export‑Support Desk in New Delhi to help firms navigate the new rules, and sources confirmed that a series of webinars on compliance will begin next week.
The minister highlighted that the combined market size of the EU, US and ASEAN represents over 1.2 billion potential customers, a figure that dwarfs India's domestic auto market of roughly 30 million units per year.
Manufacturers React: Capacity Expansion Plans Across India
The rallying cry from New Delhi sparked an immediate response from the industry's heavyweights.
Tata Motors announced a ₹30,000 crore expansion of its Pune plant, adding a new assembly line for compact SUVs that will boost output by 300,000 units annually.
Mahindra & Mahindra, the country's second‑largest carmaker, unveiled a ₹45,000 crore investment to double its manufacturing capacity in the northern state of Haryana, targeting a cumulative 1.2 million vehicle output by 2030.
Maruti Suzuki, which commands a 50 percent share of the passenger‑car market, said it will increase its Manesar facility's capacity by 250,000 units to meet rising export orders for the compact hatchback segment.
- Tata's new line will create 4,500 direct jobs and 12,000 indirect jobs in the supply chain.
- Mahindra's Haryana hub will host a new battery‑assembly unit for its EV portfolio, aiming for 200,000 EVs per year by 2028.
- Maruti's expansion is expected to raise its export share from 2 percent to 6 percent within three years.
"We see a clear policy signal that the government wants us to sell abroad, and we are ready to answer with scale," said Anand Mahindra, chairman of Mahindra & Mahindra, during a press briefing after the SIAM event.
Sources confirmed that several private equity firms are lining up capital to fund joint ventures between Indian OEMs and foreign component makers, a trend that could accelerate technology transfer and reduce time‑to‑market for new models.
Experts pointed out that the surge in capacity must be matched by logistics upgrades, noting that India's port turnaround time remains among the longest in Asia, a bottleneck that could blunt export gains if not addressed.
Road Ahead: Challenges and Opportunities for Global Footprint
While the optimism is palpable, industry insiders warn that the road to a $1 trillion export haul is strewn with hurdles.
Competition from established exporters like South Korea, Germany and Mexico means Indian vehicles must meet stringent safety, emissions and quality standards, a requirement that will demand heavy investment in R&D.
The nascent EV segment, touted as the next growth engine, faces a shortage of domestic battery cells, prompting the government to fast‑track the National Battery Mission, which aims to achieve 200 GWh of battery capacity by 2030.
Yet, analysts say the current domestic battery cost remains 30 percent higher than Chinese equivalents, a gap that could erode price competitiveness in export markets.
"If we cannot bring battery costs down, our EV exports will struggle against Chinese and Korean rivals," warned Sunita Reddy, senior consultant at KPMG India.
On the policy front, officials said the government will monitor export performance quarterly and adjust incentive structures, including duty‑drawback schemes and export‑linked credit lines.
Sources confirmed that a "Made in India, Exported Worldwide" branding campaign will launch in early 2027, featuring flagship models from Tata, Mahindra and new‑age EV startups.
The minister concluded the convention with a forward‑looking statement: "Our factories will not just feed the streets of Delhi; they will roll out onto highways from Berlin to Boston," Goyal said, underscoring the ambition to turn India into a global automotive hub.