Goyal warns automakers on fake localisation, demands export boost and global standards

Discrepancies in localisation claims

Commerce and Industry Minister Piyush Goyal cautioned automakers about "black sheep" among them that are not making adequate efforts to increase localisation in India. According to YourStory, he highlighted cases where companies set up subsidiaries in India to import goods at nominal value, which they then use to claim higher indigenisation levels. This practice, he argued, allows them to sell cars in the domestic market while circumventing genuine localisation efforts.

Government’s data-driven scrutiny

Goyal stated that the government is using artificial intelligence to analyze import-export data through Import Export Code (IEC) numbers to verify localisation claims. He emphasized that while some automakers may claim high indigenisation, the government can cross-reference their data with their supplier ecosystems to exposing discrepancies. This scrutiny aims to ensure that localisation efforts are substantive rather than superficial.

Maruti Suzuki’s export leadership

Maruti Suzuki was praised by Goyal for its export performance, with the company holding a 55% share of India’s passenger vehicle exports in the April-June quarter. According to the report, the automaker exported 4.47 lakh units in FY 2025-26 and has led India’s passenger vehicle export market for five consecutive years. Additionally, Maruti Suzuki accounted for 97% of India’s EV shipments in the first quarter of this fiscal year, reinforcing its dominance in the export segment.

Call for global standards and export expansion

Goyal urged automakers to ensure that vehicles manufactured in India meet global standards, cautioning against producing suboptimal designs that limit export potential. He cited instances where Indian-made vehicles were reportedly not exported due to designs considered inferior to globally sold models. To offset low localisation, he encouraged automakers to expand exports, with the government offering support to facilitate this growth.

The minister also stressed the importance of leveraging India’s expanding trade partnerships and growing domestic market to scale globally. He called on the industry to invest in technology, innovation, and research and development to remain competitive.

Government support and future opportunities

Goyal outlined government support for the automotive sector, including land allocation, plug-and-play infrastructure, and country-specific industrial parks based on industry demand. He invited automakers to identify locations for ecosystem development, signaling long-term government commitment to the sector’s growth.

He also highlighted India’s goal of increasing exports, urging the industry to raise its monthly export pace to $12 billion to meet the $1 trillion target for 2026-27. The minister emphasized that global competition would intensify, and automakers must use India’s economies of scale to serve international markets.

What this means

Lazyfounder analysis — our interpretation, not reported fact.

Goyal’s warnings and directives signal a shift toward stricter accountability for automakers claiming localisation benefits. For founders and operators in the automotive sector, this means two things: first, superficial indigenisation—such as importing components through subsidiaries at nominal values—will face regulatory pushback, and second, the government is positioning exports as a key lever for growth, but only for products that meet global quality standards. The emphasis on data-driven scrutiny also suggests that automakers must align their supply chains with demonstrable localisation or risk losing access to incentives. For startups in adjacent sectors—such as auto components, EVs, or logistics—this could create opportunities to partner with established players looking to deepen their indigenisation efforts or expand exports.

Key takeaways

• Automakers must align localisation claims with actual import-export data or risk regulatory scrutiny.
• Exports can mitigate low indigenisation, but global quality standards are non-negotiable for access to international markets.
• India’s trade agreements and growing domestic market present opportunities for scaling globally, but only for those investing in technology and R&D.
• Government support for large projects includes land, infrastructure, and country-specific industrial parks, signaling long-term commitment to the sector.