NEW DELHI - General Motors Corp. plans to buy $1 billion worth of automobile parts from India each year by 2008 as part of cost-cutting efforts at the world's biggest automaker, a senior executive at its local subsidiary said Friday.

GM currently buys about $120 million in parts from India each year, and the plan to increase those purchases should result in major savings for the carmaker, said P. Balendran, vice president of General Motors India.

"Auto parts in India cost 25-30 percent less than in North America or Europe," Balendran was quoted as saying in a Dow Jones Newswires report. "They are also around 15 percent cheaper than
South Korea and Mexico, but the quality is on a par."

GM India Ltd. is a wholly owned subsidiary of GM, which is based in Detroit.

GM currently buys auto parts, such as castings and forgings, from around 110 suppliers in India, Dow Jones reported.

GM is among several automakers — including Ford Motor Co., DaimlerChrysler AG, Volkswagen AG, Volvo AB and Mitsubishi Motors Corp. — that are sourcing auto parts from low-cost countries like India because of tough competition and rising costs of raw materials.

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