Reports: India surpasses China to be top auto exporter in Asia

India has surpassed China as the No.1 vehicle exporter in Asia for the first time, exporting 201,138 cars in January-July compared to China's 164,800. In addition, Indian exports in this period went up 18 percent, while China's fell by 60 percent.

Analysts said that India is doing well because of its liberal investment policies and high quality manufacturing which is proving helpful in the development and selling of new automobile models.

On the other hand, China is a big car producer and has been badly hit due to the international slump in demand following the global recession.

India's domestic car market is less than one-fifth the size of the Chinese car market, but automakers see India as a more profitable center with growing competition to develop cars for global consumption.

Due to India's quality oriented vendor base, low labor costs and highly tailored manufacturing tax (8 percent excise duty), many companies, including Suzuki, Hyundai, Nissan, General Motors, Toyota and Ford, are setting up operations in India, as they are trying to cut costs and move to making compact and fuel-efficient vehicles.

Agencies and Shi Jierui contributed to this story