(a) whether it is proposed to work out a scheme to financially help the Indian
auto component sector to become more competitive vis-Ã -vis other countries;
(b) if so, the details thereof; and
(c) the steps taken to work out a scheme to develop sustainable competitive
advantage for this sector?
MINISTER OF STATE IN THE MINISTRY OF HEAVY INDUSTRIES AND PUBLIC ENTERPRISES
(SHRI ARUN YADAV)
(a)to(c): The Department of Heavy Industry, in its pre-budget recommendations for
2009-10 to Ministry of Finance, had recommended setting up of a corpus of Rs.1000
crores for Automotive Development Fund for financing the modernization of the auto
component industry through a system of interest subsidy on loans on purchase of new
plant and equipments.It was envisaged that the fund would offset the loss incurred
on interest earnings by the financial institutions by way of reimbursing them for
the interest differential on account of extending lower interest loans to the auto
component industry.However, in the budget 2009-10 no fund for this purpose has been
provided.