Abstract
Abstract: The automobile sector holds a noteworthy position in the Indian economy. Resurgence of the sector from the shortterm slump it experienced in 2019 and the advent of electronic vehicle revolution is certain to bring about remarkable changes in the industry. Additionally, sector’s image as a bellwether of economic conditions makes it an all the more intriguing sphere to study. The paper examines the relationship between auto index, capital goods index, metal index and oil and gas index. All the indices have followed an upward trajectory in the past years. The aim is to study if these movements are related to each other through tools of Johansen Tests of Cointegration and Vector Error Correction Model (VECM). The result confirms a long-run direct relationship between the auto index and capital goods index. However, such a relationship of the auto index with the other two indices in the study remains uncertain. The data does not clearly support a conclusion in their case. Keywords: Automobile sector, Indian economy, auto index, capital goods index, metal index, oil and gas index, VECM
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