ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Breakthrough at ITI

Allowing for some margin of error in the calculation, one gets a feeling that there is some mystery here.
The percentage of indigenous content is based on the Jha Committee formula. It is calculated as the ratio of ex-works price of the built-up chassis in the country of origin (e g, Italy for Fiat and USA for Jeep) less ex-works value of imported components divided by the former. This ratio was devised to gauge the progress made by the main automobile producers in relation to the schemes of progressive manufacture submitted by them to Government in 1963. It was useful for this limited purpose, but it obviously does not give a correct indication of the actual value of total imports involved. The indigenous content has gone up over the past fourteen years because of components manufactured by both main producers and ancillary producers. The Jha Committee's ratio takes into account only the imports of the main producers, and does not cover the secondary and semi-finished components imported by ancillary producers. It also does not cover the basic raw materials imported by either.

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