Hyundai Motors has raised the proposed investment in its upcoming plant at Talegaon in Maharashtra from Rs 7,000 crore to Rs 11,000 crore. The South Korean auto major’s move follows the recent cut in the GST rate on small cars from 28 per cent to 18 per cent. Whether it is Hyundai or Toyota Kirloskar — which is setting up a Rs 20,000 crore greenfield manufacturing facility in Maharashtra’s Chhatrapati Sambhajinagar district — the underlying motivation seems to be to leverage India’s domestic market as well as export potential. The ability to cater to both segments is something that many foreign firms have implicitly recognised. Maruti Suzuki not only sold over 19 lakh vehicles in India, but also exported 3.3 lakh units from the country during 2024-25. The Japanese carmaker has commenced the production of e-Vitara, its first electric vehicle. The bulk of these, from its Hansalpur (Gujarat) facility, will be exported.
The business strategy of both domestic sales and exports from India makes sense, especially when tariff and non-tariff barriers are reappearing. India’s domestic market offers a fallback base for firms actively engaged in exports. That flexibility should improve with better infrastructure (the Samruddhi Mahamarg expressway connecting Mumbai and Nagpur makes it possible for Toyota to produce and export from Sambhajinagar) and the GST rationalisation exercise. Prime Minister Narendra Modi’s interpretation of Swadeshi — no matter from which country the company comes from or even if the product has a foreign name, it should be manufactured in India — sends the right signal.
What India today needs is more success-story investments like those of Maruti Suzuki, Hyundai and, more recently, Apple and Samsung, which have helped turn the country into a global-scale assembler and even exporter of smartphones. The level of domestic value addition in the latter is still low compared to the manufacturing ecosystem that the big auto players have created. But the point about success stories is that have a demonstration effect on other prospective investors, both domestic and foreign, as they start seeing concrete cases of Make in India “for India and for the world”. That’s why government needs to enable with stable policies and schemes that provide one-time incentives and clear sunset clauses to attract large-scale investment across key sectors where India has potential comparative advantage. Turbulent global times like these can present opportunities waiting to be grabbed.
