Automobile growth and reforms go hand in hand in any country. There are several reasons to explain this fact. Imagine, if there are more number of cars zooming on roads, definitely, the strong infrastructure would be required to accommodate their increasing number. So, new reforms would have to be brought in to development infrastructure. Similarly, workers have to work in tandem and the labour union strikes would have to be brought to end. For this situation, there will have to be friendly labour reforms. Not only these, there would also be a requirement of friendly taxation process to make different companies competitive to bring new models of cars.
No doubt, India has made progress in building new roads, highways and expressways. Even the supporting infrastructure like airports, ports, railways and power plants exist, but the infrastructure growth has not kept pace with growing demand. So it is a must to recognise that infrastructure is a major driver of growth for auto industry.
If we consider China, it has provided a huge competitive advantage for their industry by focussing on main factor, that is, infrastructure development. This initiative can give a major boost to public policy making and planning that would in turn boost demand in the sector especially commercial vehicles and build efficient public transport models.
Mobility in Smart cities
Till date, India has witnessed a remarkable automotive growth fueled by urban consumers. On the contrary, rural India, home to 70% of the country’s population, accounts for only a fraction of sales. In contrast, China comprises urban majority country. So the moral of the story is that the Government’s vision for economic growth and development in rural India will definitely pave the way for launch of products targeted at this segment.
The rural demand will be unlocked for vehicles and help India realise its true potential.
Labour law reforms
The auto industry faces high incidence of strikes due to outdated labour laws. These were earlier considered as the flash point between automotive companies and their labour force however, reforms could change this scenario in the days ahead.
Mike Cornell and Emma Jones are behind the success of Elearning Blog, a blog solely focused on providing free resources and tips for e-learning.