CHENNAI: While the Union budget does not have any major policy announcement with respect to the automotive sector, the earlier announced extension of the excise duty cuts and the focus on infrastructure development, especially roads, have met with a positive reaction from the automotive industry.
With excise duty cuts already resulting in a slight, but tangible, upturn in the sales of automobiles in the sector in the last two months, according to Society of Indian Automobile Manufacturers figures, the budget is expected to help the sector get back on track.
According to Mahindra & Mahindra Executive Director Pawan Goenka, while the budget did not meet expectations of an incentive on electrical vehicles, as a whole it was a good one for the country and the industry. “While we did expect an announcement on incentives for electric vehicles, which did not come through, and a firm date for GST implementation would have been welcome, the Finance Minister has delivered a well defined and prudent budget with specific focus on infrastructure, manufacturing and rural schemes,” he said.
Japanese automotive major Nissan’s India president Kenichiro Yomura concurred. “Though there were expectations of bolder reforms for the auto industry, certain aspects like the continuation of excise duty concessions along with reduction in steel prices and elimination of customs duty on auto components bode well for the sector,” he pointed out.
Venu Srinivasan, Chairman and Managing Director of TVS Motors, said that specific to the automotive industry, the expected turn-over in economic growth would go a long way in contributing to the recovery of the sector.
“Cars and two-wheelers have already started to boom in the last two months. This should only help in enhancing that trend,” he said.
General Motors India president and managing director Arvind Saxena pointed out that the focus on rural roads, highways and expressways were welcome decisions.