European carmakers to shift manufacturing base to India: Goyal

Commerce and Industry Minister Piyush Goyal on Monday forecast that European carmakers would migrate manufacturing operations to India to escape the competitive disadvantages posed by the European Union's strict regulatory framework. Speaking at The Dilli Dialogue in New Delhi, Goyal said India's regulatory environment and cost structure would make it an attractive alternative for global automotive producers.

"India is going to become the global hub for car manufacturing. Everybody is going to come and manufacture in India, and with Europe having such stringent regulations, it is going to be impossible to be competitive. All the European manufacturers will come to India," Goyal said.

The minister's comments come against the backdrop of India's recent trade pacts with major developed economies. The free trade agreement with the UK came into effect on July 15, while a similar deal with the European Union is expected to be finalized by year-end. Both agreements include quota-based tariff concessions for automotive products, positioning India as an increasingly attractive manufacturing destination.

Goyal cited the example of Tata Motors, which acquired British luxury carmaker Jaguar and subsequently undertook extensive re-engineering efforts to stabilize operations and enhance competitiveness. He suggested that India's growing industrial capabilities and regulatory environment offer advantages for global automakers seeking to establish or expand manufacturing bases.