The Automotive Component Manufacturers Association of India (ACMA) demanded that the industry should be brought under a uniform 18 percent GST rate.
"A benign rate of 18 percent will not only ensure better compliance but will also ensure a larger tax base," ACMA President Nirmal Minda was quoted as saying in a statement.
The majority of the automotive component sector in India has SMEs in it, this demand of ACMA seems to be representing the core demand of the SMEs. According to ACMA, currently 60 percent of the components attract 18 percent GST rate, while the rest 40 percent, the majority of which are for two-wheelers and tractors, attract 28 percent.
Speaking at an event here to announce the auto component "Industry Performance Review" for fiscal 2017-2018, he said, "Further, considering the significant technological changes that the industry is undergoing, there is a critical need for creating a fund to support indigenous R&D and technology creation in the component industry as also for technology acquisition from other parts of the world."
He elaborated the need for a "technology agnostic road-map with clear responsibilities of each stakeholder" to ensure a smooth rollout of electric mobility in the country.
On the industry's financial performance, the "Industry Performance Review" showed that the sector's turnover grew by 18.3 percent to Rs 345,635 crore ($ 51.2 billion) during the last fiscal.
Further, exports showed a growth of 23.9 percent in FY2017-18 to Rs 90,571 crore ($13.5 billion).