GST 2.0 has provided a significant boost to India’s automobile industry and the broader economy, Maruti Suzuki India Chairman RC Bhargava said, arguing that the tax reforms have helped the country navigate economic uncertainty caused by the West Asia conflict.
Speaking at the company’s annual general meeting, Bhargava said India’s economic performance has remained resilient despite geopolitical challenges, while GST collections have continued to remain strong. He credited the tax reforms with providing a buffer during a difficult period.
GST Reforms Lift Auto Sector Outlook
Bhargava said Maruti Suzuki expects the Indian passenger car market to reach 6.1-6.3 million units by 2031. He also expects small cars to record significantly faster growth than they did during the previous five years, partly driven by the GST rate reductions announced last September.
The chairman described the GST changes as a major reform that has created fresh momentum for automobiles and other sectors. He urged both the Centre and state governments to accelerate reforms, simplify business processes and increase technology adoption to reduce delays and corruption.
Bhargava also called for greater trust in private businesses and competition, arguing that faster wealth creation would support higher government revenues and more inclusive economic growth.
Maruti Expands Production Capacity
To prepare for stronger demand, Maruti Suzuki is expanding its manufacturing footprint. The company expects its installed production capacity to rise to 2.9 million vehicles by the end of FY27 and 3.65 million units by FY31.
Two production lines have already been commissioned at the company’s Kharkhoda facility in Haryana, with work underway on another line.
In Gujarat, Maruti has commissioned a fourth production line at Hansalpur, taking the plant’s annual capacity to 1 million vehicles. Bhargava said the facility is Suzuki’s largest manufacturing plant globally.
The company has also begun work at a new site in Sanand, Gujarat, where it plans to establish another 1-million-unit annual capacity. The proposed investment in the facility is around ₹35,000 crore.
Bhargava said the expansion reflects the company’s confidence in India’s long-term economic growth potential.
