The automotive industry body SIAM (Society of Indian Automobile Manufacturers) said on Monday that the uncertainty over the government’s policy on the pricing of diesel is forcing the leading car makers in India to hold their major investment plans. According to SIAM, the two largest car makers in the country including Maruti Suzuki and Hyundai Motors India have put on hold their investment plans of over Rs 3,000 crore.
Speaking to the reporters, Mr. Vishnu Mathur, Director General of SIAM, said, "Many of our members are still unclear whether they should invest on diesel technology or not in India as there is no clarity on how the fuel will be priced in future. This has resulted in more than Rs 3,000 crore of investment being held back."
He added that leading global firms including Maruti, Hyundai, Tata Motors, Ford and General Motors, which were earlier aggressively planning to set-up diesel engine manufacturing facilities in India, have now kept their plans on hold.
The country’s second largest car maker Hyundai had announced its ambitious project of setting-up a diesel engine production plant in the Indian market with an investment of Rs 400-crore. With an initial capacity of 1.5 lakh units per annum, the plant is prospected to manufacture different capacity engines for the domestic market including 1.1 litres, 1.4 litres and 1.6 litres. Similar investment plans were indicated by companies like Maruti Suzuki, Tata Motors and Ford.
