Southern Spices
As a surprise move, the Reserve Bank of India has cut the key policy rate by 25 basis points for the third time this year because of falling inflation and slow economic growth. But the apex bank kept the Cash Reserve Ratio (CRR) unchanged at 4%. With the repo rate reduced, EMIs are likely to come down much to the relief of consumers if it is passed on by the bank. But after reducing the repo rate twice early this year, it does not have any impact on the auto sales figures and remain a mixed bag. In May, the overall industry numbers have dipped by 0.58% and April-May 2015 cumulative sales have plateaued out the Indian automotive industry performance to a flat 0.61%. It is hoped that if the monsoon is good enough then the numbers may go up. But beyond a point if the purchasing power increases then the sales figure surges without depending on other factors. By looking at the current scenario, the industry body SIAM is expecting a growth of 5-10% in the Indian auto industry by FY16.
We have heard the phrase ‘competition brings out the best in you,’ many times, haven’t we? This is what happening in the Southern states as each government compete with each other to attract more investments in their respective states. For an instance the situation is hot and spice in Andhra Pradesh after the split and in Tamil Nadu a lot of initiatives have been started to boost the industry since Jayalalithaa came back to her hot seat. The government is gearing up towards organising its Global Investors Meet (GIM) on September 9 and 10. So far Rs 76,000 crore of investments have been lined up for signing of MoUs during the 2 days event.
The Chief Minister of Andhra Pradesh, N Chandrababu Naidu is pursuing his vision and goals to make the state world class and looking to attract more investors across the sectors with his new industrial policy. The competition between these 2 states is heating up as both the states have some common similarities.
The Southern states, which is the focus of this issue, continues to be a significant region for the Indian automotive sector, despite the growing challenges from the Western and National Capital Regions. The southern region has twowheeler manufacturers, passenger car manufacturers and commercial vehicle manufacturers, apart from the heavy vehicle manufacturers. Even though each state has different problems, South India continues to be preferred destination for many global OEMs and component manufacturers.
This issue is packed with stories from different sectors and the companies have shared their views on the industry, suppliers and government policies. In Value Engineering section we have covered the World’s cheapest car Tata Nano GenX, which is refreshed and equipped with Magneti Marelli’s fourth generation Automated Manual Transmission (AMT).
Hope this issue is of specific interest. Please do send us your comments.
Bhargav TS
Executive Editor
s.bhargav@nextgenpublishing.net
