New Delhi

In a recent communication to the Government of India, the Automotive Tyre Manufacturers' Association (ATMA) emphasised the nation's potential to achieve self-reliance in tyre manufacturing. The association highlighted that India's robust domestic tyre industry could eliminate the need for imports, aligning with the government's goal of self-sufficiency in various sectors.

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Government's call for self-reliance

The Government of India had recently sought inputs from various industries to identify items that could be domestically produced, ensuring upcoming Free Trade Agreements (FTAs) protect local industries. Responding to this call, ATMA underscored the significant capabilities of India's tyre industry, which ranks among the largest globally.

Current state of tyre imports

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Despite the industry's substantial manufacturing capacity, India imported tyres worth over Rs 2000 crore in the first three quarters of FY24. This figure represents a 27% increase compared to the same period in the previous year. This surge in imports underscores the need for bolstering domestic production to meet growing demand.

Substantial investments in the tyre sector

"Over the last few years, the tyre sector has witnessed substantial investments, with leading manufacturers allocating over Rs 35,000 crore towards capacity expansion, technology upgrades, and research and development," said Arnab Banerjee, Chairman of ATMA. These investments are crucial for enhancing domestic production and reducing dependency on imports.

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Employment and economic impact

The domestic tyre industry is a significant employer, providing livelihoods to over 500,000 people directly and indirectly in manufacturing, distribution, and related services. Additionally, prioritising domestic tyre manufacturing is vital for the livelihood of over 10 lakh rubber growers in the country, as the tyre industry consumes over 70% of the domestic natural rubber.

Technological advancements and R&D

The Indian tyre industry is embracing technological advancements, with concepts such as Artificial Intelligence (AI) and digitisation transforming operations. The sector's R&D spending by major tyre companies has increased from 0.5-0.6% of revenue a few years ago to about 1.5% currently. These advancements are positioning the industry to meet the demands of both domestic and international auto OEMs.

Meeting auto OEM requirements

"The industry is geared to meet all the requirements of domestic and international Auto OEMs by way of design, development, and ensuring regular supply of tyres for all categories and types of vehicles manufactured in the country," added Banerjee. The domestic tyre industry is ahead of the demand curve, ready with fitments as soon as a vehicle is conceived, eliminating the need for auto OEMs to import tyres.

Future focus on sustainability and efficiency

Currently, tyre manufacturers are intensifying R&D efforts to meet expectations of reducing emissions, light-weighting, enhancing fuel efficiency, and lowering rolling resistance. These efforts are crucial for fostering sustainable production and aligning with global environmental standards.

Strengthening India's Position as a Global Leader

By fostering domestic production and leveraging technological advancements, India can strengthen its position as a global leader in the tyre industry. This strategy will generate employment, promote sustainability, and drive economic growth. Emphasising self-reliance in tyre manufacturing not only supports the local economy but also aligns with the broader vision of making India a manufacturing hub.

India's tyre industry stands at a pivotal juncture, poised to significantly reduce import dependency through enhanced domestic production capabilities. The substantial investments in capacity expansion, technology upgrades, and R&D are critical steps towards achieving this goal. As the industry continues to evolve with advancements in AI and digitisation, it is well-positioned to meet the demands of both domestic and international markets.

The government's push for self-reliance, coupled with the industry's proactive measures, underscores a future where India could emerge as a global leader in tyre manufacturing. This journey towards self-sufficiency not only promises economic benefits but also reinforces the nation's commitment to sustainability and innovation.