RC Bhargava, Chairman of Maruti Suzuki, stated that the GST 2.0 reforms have supported several sectors and helped the Indian economy navigate the uncertainty caused by the conflict in the Middle East.
Addressing shareholders at the company's annual general meeting on Monday, Bhargava noted that Maruti Suzuki India expects the Indian automotive industry to reach a volume of 6.3 million units by 2031, with the market share of small cars growing significantly faster than in the previous five years. This growth is attributed to the reduction in GST rates implemented last September.
Bhargava emphasized that the Indian economy continues to show good results, and GST collection exceeds all previous records despite challenges related to Iran and the war in the Middle East. He expressed confidence that achieving such success during difficult months would have been challenging without the GST reforms.
Affirming his previous optimism about the future of the auto sector after the implementation of GST reforms, the head of India's leading automotive market said that these changes have given a new impetus not only to the automotive industry but also to other sectors of the economy. Furthermore, national GDP growth figures turned out better than the forecasts of most agencies.
Thanking Prime Minister Narendra Modi, Finance Minister Nirmala Sitharaman, and all other members of the government for the 'historic step of reform,' Bhargava urged state and central authorities to accelerate the reform process, simplify doing business, and actively utilize technology, as time has shown this reduces corruption and delays.
He also appealed to governments to trust the private sector and the power of competition, noting that faster wealth creation will lead to increased government revenue and more equitable development of the country if current government programs continue.
Bhargava called on all political parties to consider reforms as a national task, as they contribute to accelerating development, enhancing the competitiveness of the Indian economy, and creating more jobs through increased economic activity. He stated that India's strength in all global matters will depend on its economic power.
The company head added that for many years, it has been observed that without wealth creation, it is impossible to move towards a more prosperous society, a more economically strong India, or an expansion of social welfare measures.
Regarding the prospects of the automotive industry, Bhargava reported that Maruti Suzuki India is in the process of compiling the most accurate assessment of the probable growth of the automobile market in the next five years, which was made possible by the GST reforms. He specified that the company estimates the growth of the automotive industry to be up to 6.1–6.3 million units by 2031, with the small car segment growing substantially faster than in the last five years.
The company continues to increase production capacity to meet expected demand. As a result of ongoing expansion projects, its installed capacity will reach 2.9 million units by the end of 2026–27 and 3.65 million units by the end of 2030–31, given the economy's huge growth potential.
Maruti Suzuki India has launched two lines at its factory in Kharkhoda, Haryana, and work on a third line is ongoing. Additionally, a fourth line with a capacity of 2.5 lakh units has been launched in Hansalpur, Gujarat, increasing the total capacity to 1 million. This plant is the world's largest Suzuki plant, according to Bhargava. Work has begun on a new facility in Sanand, Gujarat, where a total capacity of 1 million units is planned. The proposed investment in Sanand amounts to approximately 35,000 crore rupees.
