CHENNAI: E-Vehicles Even as many expectations of the Electric Vehicle (EV) sector were not met in the Union Budget, stakeholders feel the proposed budget will help the industry grow in long run.The government raised customs duty on imported Completely Built Units (CBUs) of commercial EVs to 40 per cent with effect from April 1, from 25 per cent currently. It also proposed to enhance customs duty on Semi Knocked-Down (SKD) forms of passenger EVs from 15 per cent to 30 per cent. Similarly, the government has proposed to hike customs duty on SKD forms of electric buses, trucks and two-wheelers.
EV manufacturers feel the move will encourage manufacturing locally. “Increased customs duty on EV imported in form of CBU/SKD/CKD, will increase EV manufacturing. In coming years, we feel that duty on EV component import should also be increased to promote local component manufacturing,” said Sulajja Firodia Motwani, Founder and CEO of Kinetic Green.“From an EV industry point of view, the budget is quite neutral.”
B C Datta, vice-president (corporate affairs), Hyundai, felt the new electronic manufacturing scheme announced to promote automotive electronics and semi-conductors manufacturing will benefit the industry in the long run. “It will encourage development of new technologies which will boost EV component manufacturing and strengthen the supply chain.” The government has proposed to increase customs duty from 5 per cent to 7.5 per cent on parts used to manufacture catalytic converters. However, industry experts feel there is a need to provide further incentives to the sector.
According to Pankaj M Munjal, Chairman and MD, Hero Motors, the government must incentivise e-vehicle manufacturers, and funnel a portion of the `1.7 lakh crore earmarked to boost infrastructure. “While lowering GST on electric vehicles has benefited manufacturers, the heavy taxation on raw materials is still a concern. We expect the government to reduce the GST rate so that EV manufacturers are encouraged to set up battery manufacturing units indigenously,” he said.
Ayush Lohia, CEO, Lohia Auto
Budget has no major reforms for the Electric Vehicle sector specifically... However, the budget has some positives as there is a massive state funding to help India’s farm sector, aiming to get broader economic growth back up from its lowest in a decade.