Gujarat is poised to become the Detroit of India, thanks to the increasing number of automobile giants who have set up production units there.
Sanand, located in Gujarat's Ahmedabad, was a sleepy hinterland before Tata Motors decided to relocate its Nano car project from Singur in West Bengal to Sanand back in 2008. The following years saw other players in the automobile sector, such as Ford, Suzuki, Honda and Hero MotoCorp, making a beeline to Sanand, which is 22-km away from Ahmedabad.
Modi's vision
India's current Prime Minister Narendra Modi can take the credit for luring big automobile plants to set up bases in Gujarat. When Ratan Tata was looking for an alternative location to set up the Nano project following anti-land acquisition agitation in West Bengal, Modi sent him a text message promising to give him land in Sanand.
“When Mr Tata announced that his company was quitting Singur (West Bengal), I SMSed him to come to Gujarat. The one-rupee SMS did the trick,” Modi said.
The first Nano rolled out of the Sanand plant in 2010.
Tata Motors became the magnet that attracted other automobile brands to Gujarat.
Lure of Sanand
Sanand proved to be an ideal location to set up automobile factories as lands were aplenty. Good infrastructure, uninterrupted supply of power and port connectivity were points stacked in its favour.
Elaborating on Gujarat's special auto focus, M Sahu, Gujarat's Principal Secretary, Industries and Mines Department, told the Hindu Business Line in 2013: “Backward integration is one of the highest in this business. This means if one mother plant comes in, it will bring hundreds of ancillary units. The automobile industry has the highest multiplier effect."
He also pointed out that the state do not have any land acquisition problems. “They get good money for land which is not fertile. There is no forcible acquisition,” he added.
Sanand is also part of the Delhi-Mumbai Industrial Corridor. The easy accessibility to northern and western markets means cars can be delivered cheaper and faster to these parts of the country. Today, Gujarat is part of an group of automobile manufacturing states including Maharashtra, Tamil Nadu and Haryana.
Green Technology
The focus today is on green technology and car makers are slowly shifting to hybrid and battery-operated vehicles.
In 2017, the JSW Group signed an agreement with Gujarat government to promote production of battery operated vehicles in the state. The company will investment Rs 4,000 crore in the venture and it is expected to build around 2 lakh vehicles annually, reported Livemint.com.
Commercial production in JSW Energy's car factory, which is located near Suzuki's manufacturing plant in Hansalpur, is expected to start in 2021.
Besides JSW Group, Suzuki, MG Motors India and Tata Motors are also looking to produce electric cars from their factories in Gujarat.
