ELECTRIFY THE WHEELS

The auto sector hopes the Budget will help it get back on track

INDIA’S AUTO industry has been facing headwinds for the past few years, made worse by the pandemic and the semiconductor crisis. Automakers expect the Budget to address the industry’s concerns and help it get back on track, especially luxury OEMs. “Burdened under high duties, GST, cess and registration costs, we urge the government to rationalise the entire tax structure, which eventually will lead to higher volumes for the industry. Equally important is a stable policy regime for an uninterrupted business due to long lead times, which is specific to the luxury automotive industry,” says Balbir Singh Dhillon, Head of Audi India. The auto components industry, meanwhile, wants a uniform GST rate of 18 per cent on all auto components. “The industry has significant aftermarket operations that are plagued by grey operations and counterfeits due to the high 28 per cent GST rate. A moderate rate of 18 per cent will not only address this challenge but will also enhance the tax base through better compliance,” says Sunjay Kapur, President, The Automotive Component Manufacturers Association. Experts say the Budget will be crucial for the auto sector as it can facilitate the industry’s effective revival and that electric mobility will be a key focus for the government going forward. “With several Indian and international groups keen to invest in the EV segment, the government should focus on bolstering the infrastructure to enable easy manufacturing and usage of EVs and EV-related elements such as charging kiosks to boost demand... we’re in the midst of one of the biggest tech-led transitions in India and the world, and we expect that this year’s Budget will focus more on tech-led developments,” says Greg Moran, CEO and Co-Founder, Zoomcar.