This paper reviews the developments in the Indian auto component industry in the context of new economic policies. It analyses the technical capabilities and export experiences of the industry. It presents the findings of field and mail surveys aimed understanding the nature of competition, key capabilities and the involvement of internal and external agencies in technology development, and new product introduction. It concludes by saying that the industry is on the growth path and can exploit the emerging opportunities in the international market if the pace of learning by the industry is quickened.