Auto parts industry awaits US tariff deal

The Automotive Component Manufacturers Association of India (ACMA) on Tuesday expressed confidence that the government will secure the best possible outcome in ongoing trade negotiations with the US, as India's auto components industry faces tariff uncertainty and investigations by American authorities.

The US is India's largest export market for auto components, accounting for 26% of the country's exports in the segment. India's auto component exports increased 5% to $24 billion (₹2.12 lakh crore) in FY26.ACMA Director General Vinnie Mehta said the industry is closely watching the bilateral trade talks and expects the government to negotiate a favourable tariff arrangement.  At present, Indian auto components attract US tariffs of 25% and 12.5%, depending on the product category.  

The US is also investigating imports from India over allegations related to labour practices and subsidy-driven excess production.   Mehta rejected both claims, saying India's auto component industry follows labour laws and does not employ child labour. He also dismissed allegations of government subsidies, noting that only a handful of component makers have received benefits under the Production-Linked Incentive (PLI) scheme. 

According to him, the industry has not received widespread government support that could create excess manufacturing capacity.