India’s dream of becoming a global small car hub may not become reality. Car manufacturers, who are till recently beaming over the reduction of excise duty on small cars, are now considering limiting their exports to maintain profitability as the government has not given incentive to encourage the exporting of passenger cars. Lack of incentive from the government is expected to affect the growth of export business of many car manufacturers.

Sale of small cars, sedan and luxury cars is increasing in domestic market but lack of incentive for export and continues depreciation of the dollar, is bound to affect the sale of many cars in overseas market. Discouraged by the government’s disinterest in encouraging export business, largest exporter of passenger cars from India like Hyundai motor, Maruti Suzuki are seriously considering to downscale their original target of exporting 50 productions from India. Government should join hands with car companies to make India a global hub for small cars by giving some impetus to small cars export business.