Union Road Transport and Highways Minister Nitin Gadkari on Thursday, 9 July declared that India's automobile industry has surpassed Japan to become the world's third largest by value, with its size expanding from ₹14 lakh crore to ₹22 lakh crore. He made the announcement while inaugurating 'Prawas 5.0', a multimodal transport exhibition organised by the Bus and Car Operators Confederation of India (BOCI) in Gandhinagar.

From Seventh to Third: The Rise in Rankings

Gadkari credited the sector's transformation to policy reforms and government-industry collaboration on new technologies and alternative fuels. 'When I took charge as a Minister, the size of this industry was ₹14 lakh crore and our rank in the world was seventh. Today, we have moved forward, surpassing Japan, and our rank is third in the world. The size of this industry is ₹22 lakh crore. The US ranks first and China ranks second,' he said.

Tax Revenue and Employment Impact

According to Gadkari, the automobile sector now contributes approximately ₹4.5 lakh crore annually through Central and State GST combined, making it one of the largest sources of tax revenue for both the Union and state governments. The industry has also generated employment for around 4.5 crore people, underscoring its role as a critical economic driver across manufacturing and ancillary services.

Vision for Clean and Sustainable Mobility

The Minister outlined the Union government's transport vision as rooted in the principles of ethics, economy and ecology. He called for an accelerated shift toward alternative fuels — including bio-fuels, ethanol, methanol, bio-diesel, LNG, electricity and hydrogen — to cut pollution and reduce India's dependence on imported fossil fuels. 'Public transport must increasingly adopt technologies that reduce pollution and dependence on imported fossil fuels while remaining economically viable,' he noted.

Gadkari also stressed that four pillars underpin sustainable industrial growth: proven technology, availability of raw materials, economic viability, and effective marketing. He linked stronger transport infrastructure directly to job creation and poverty reduction, describing transport as 'central to India's economic development.'

About Prawas 5.0

The 'Prawas 5.0' exhibition brought together transport operators, vehicle manufacturers, and industry representatives to deliberate on the future of public transport and mobility in India. The inaugural session was attended by Gujarat state ministers Jitu Vaghani and Kantilal Amrutiya, ministers from Uttarakhand and West Bengal, BOCI President Prasanna Patwardhan, and other senior industry stakeholders.

India's ascent to third place globally in automobile value marks a significant inflection point for a sector that was ranked seventh just years ago — and the next milestone, closing the gap with China, will depend on how quickly the industry scales alternative-fuel and electric vehicle manufacturing.