PLI boosts scale, but firms must turn self-reliant: Nirmal Minda

N. K Minda, CMD, Uno Minda.

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The auto component industry is currently seeing positive momentum, with GST realisation and tax relief measures. Nirmal Minda, Chairman, Uno Minda, speaks to ETAuto about the industry outlook in view of FTAs signed with the EU and the US and how India can incentivise R&D investment to remain globally competitive.

Minda, who recently took charge as President of ASSOCHAM, also talks about the PLI scheme and why companies should not rely on incentives indefinitely.

Edited excerpts:

India has recently signed multiple FTAs, including agreements with Europe and the US. What opportunities do you see for the auto component industry?

These agreements are a very positive move. After the ASEAN agreement almost two decades ago, we were waiting for more such initiatives. The government is now very proactive and is engaging closely with the industry.The biggest opportunity is for manufacturing. Today, manufacturing contributes around 17 per cent to India’s GDP, but it should grow to 25–30 per cent. That will lead to job creation, higher per capita income and overall economic growth.

India also has a strong cost advantage in terms of manpower and operating costs compared to Europe and the US. With the right technology and exports, not only manufacturing but sectors such as textiles, services and pharmaceuticals can benefit significantly.

You have often highlighted that India still lags in technological innovation. What roadmap should the country adopt to bridge this gap?

Technology advancement requires strong investment in R&D infrastructure—equipment, testing facilities and research capabilities.Talent is not the issue. Indian professionals are working across global companies in sectors ranging from automotive to healthcare. The key is to nurture this talent within India.We are also advocating policies where R&D investments are incentivised, potentially through schemes similar to PLI. If companies invest more in patents and local innovation, the government could provide incentives. This will reduce dependency on royalty payments, technology licences and imports in the long run.

Uno Minda has significantly expanded its technology capabilities in recent years. What has driven this transformation?

About 10 years ago, we realised that technology would become central to the automotive industry. We established a CREATE centre, which focuses on research and technology development.We also started working heavily on software and electronics, as vehicles are increasingly becoming software-defined.

Within our engineering teams, we focus on three categories of innovation: incremental, diversified and radical innovation. The goal is to encourage young engineers to develop solutions that can be first-of-their-kind in India and eventually exported to global markets.

The government continues to expand schemes like PLI, including for electric mobility. What impact do you see on the industry?

Such schemes are extremely useful in the initial phase. They help industries scale up and invest in new technologies.However, companies should not rely on incentives indefinitely. PLI benefits should ideally support growth for two to three years, after which companies should become self-reliant and competitive on their own.

What is your outlook for the industry and Uno Minda in the coming years?

The industry is currently seeing positive momentum, especially after GST rationalisation and tax relief measures that have improved affordability.

At Uno Minda, our philosophy is simple—we aim to grow faster than the industry. Our target is to grow at 1.5 times the industry growth rate going forward.