also giving some concessions to the auto industry. To realize the above growth predictions, it isimportant to overcome various challenges the industry is facing currently. Two of the foremostchallenges are the spiraling cost of fuel and the paucity of highly skilled manpower.
Rising oil price
International price of crude oil has crossed US$ 120 per barrel and is rising at an alarming rate.The forecast of market experts that the crude oil price will plateau around US$ 100 per barrelhas been proved wrong. The skyrocketing crude oil price rise will affect the economic growth of most of the nations of the world including India. The prospects of India and China of becomingeconomic superpower will be seriously affected. Also, the rise in oil prices will impact thegrowth of global automotive industry. Unless the use of alternative fuels increases, it is veryunlikely that the situation will change for the better.This necessarily means that more and more investments should be directed towards R&D,establishing mechanisms to translate R&D results into products and their efficientmanufacturing. This will also require radical redesigning of engines.
The second major challenge is the creation of highly skilled human resource required for theauto industry. Auto industry, like many other industries is facing severe shortage of skilledtechnical as well as managerial manpower. This challenge becomes all the more daunting because faults lie at a more fundamental level of training infrastructure and the social perception.
The growth of auto industry in India will be contingent not just on domestic demand, but alsoequally on exports. Therefore, the present projections will become a reality if thrust is given tooriginal research that will yield breakthrough results. These results help in addressing the current
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