The industry body attributed the higher imports to technology needs, global sourcing strategies, competitive pricing and temporary domestic capacity constraints, while projecting 8-10% growth for the sector in the current fiscal.
Even though there is a robust growth in the Indian auto components sector in the financial year 2025-26 (FY26), the imports from China are still higher at 36 per cent during the year as compared with 29 per cent in FY25, the performance review for FY26 shared by the Automotive Component Manufacturers Association of India (ACMA) has indicated.According to the Industry Performance Review for FY2025-26, ACMA said while the US remains the key destination for exports at 26 per cent in FY26, China is the key source of imports with 36 per cent, followed by Japan with 11 per cent, Germany with 10 per cent and South Korea with 7 per cent.China remains the largest source of imports“The auto industry is a global industry and I guess no one country makes everything...We don’t have an OEM (original equipment manufacturer) from China though, but the OEMs from China are now selling finished products in India. Yet there is a significant import of auto components from China, and the reason for imports from China, or any place could be manifold,” Vinnie Mehta, Director General, ACMA, told businessline.Mehta said there could be various reasons, such as technology-related ones, as some vehicle manufacturing companies are global and require critical components that are not yet made in India. Secondly, it could be that some companies have a policy to import from a Mother plant of a particular item for production in a particular geography, and that geography is China. And thirdly, it could be a very simple, price-competitive reason.“Another reason could be, when in the domestic capacities growth happens in the vehicle industry a little too fast and there could be a capacity shortfall, they may resort to import from China. At least in one particular case where China sort of stopped export of rare earth magnets, but it has not stopped import of sub-assemblies and exported with fitted rare earth magnets or finished product from there,” Mehta explained.Industry posts double-digit growth, outlook remains positiveMeanwhile, driven by robust domestic demand, higher vehicle production, and sustained investments in capacity, the Indian auto components sector recorded a turnover of ₹7.60 lakh crore ($85.9 billion) in FY26, registering a 12.7 per cent growth compared with around ₹6.74 lakh crore in the previous fiscal.With continued domestic demand and exports, despite geopolitical headwinds, the sector is expected to grow by 8-10 per cent in the current fiscal, it said.“The medium-to-long-term outlook for the Indian auto component industry remains positive. Growing domestic demand, infrastructure-led economic growth, expanding manufacturing investments, deeper global integration through Free Trade Agreements (FTAs) and increasing global sourcing from India are creating significant opportunities for the sector,” Vikrampati Singhania, President, ACMA and Vice Chairman & MD, JK Fenner (India) said.Published on July 7, 2026
