Finance Minister Nirmala Sitharaman will present the last budget for the NDA government, as the country goes to poll this year. The automotive industry is hopeful that the government will give further impetus to the record sales and vehicle manufacturers are pinning their hopes on the same.
Santosh Iyer, Managing Director & CEO, Mercedes-Benz India: “We expect capex on infrastructural projects to continue, aiding the automotive sector. The policy push for green mobility should remain a key focus for the government, encouraging faster adoption of electric vehicles. The luxury car industry has significant value contribution to the GDP and our wish for a rationalized duty structure and GST stays on priority. Overall, we expect consistency in various policies and no surprises in the upcoming budget.”
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Narinder Mittal, Country Manager & Managing Director, Agriculture Business – CNH India & SAARC: “We anticipate a forward-looking Union Budget this year as well, as the government has made the agriculture sector one of its main priorities. In order to prepare the agricultural sector for the future, we hope to see measures that can further aid in the adoption of innovation and technology to improve agri mechanization in our country. Initiatives to improve farmers’ skills and understanding of modern farming methods, financial literacy, and other relevant aspects will be crucial for the industry in the long run.”
Tanmay Bhattacharya, Executive VP, Lexus India: “Despite global volatility, India’s economy has thrived, securing its position as the fifth largest and fastest-growing economy in the world. Various Government initiatives with a focus on infrastructure have drawn substantial investments, fostering growth and thereby paving the way for the emergence of more HNIs, especially younger, making it an exciting time for the luxury market in India. The luxury automotive industry has also grown substantially in CY 2023, primarily riding on the change in consumer outlook owing to increase in disposable income. The consumer is most definitely reflecting a post pandemic phenomenon, the YOLO (you only live once) effect. The well-travelled consumers, with a propensity to spend is levitating towards sustainable luxury. In fact, this growth is not just noticed in Tier I markets but in Tier II markets as well.”
Niraj Rajmohan, Co-founder and CTO, of Ultraviolette: “We continue to benefit from recent developments, such as the reduced GST on EVs and road tax considerations. The reduced GST rates on EVs and chargers have helped narrow the price gap between EVs and fuel-based vehicles. On the FAME subsidies, due to the cap on the price of eligible EVs, it does not apply to us due to the nature of our offerings, but we acknowledge the government’s rationale and hope for an increase in support.”
“Our customers continue to believe in the product and remain resilient in terms of valuing top-of-the-line performance and next-gen technology. We believe that any extension of the FAME subsidy and removing all caps on the ex-factory price of EVs would greatly enhance our position. When the government launches initiatives that encompass technology development in India, we advocate for a subsidy structure without segment caps. Encouraging multiple segments is crucial, and technology, being universal, shouldn’t be restricted. When it comes to EV exports, we are starting to reap the benefits, particularly as we embark on exporting vehicles to first-world countries. This marks a significant shift from the traditional vehicle export landscape, which is usually directed towards developing markets. We hope for additional benefits associated with ‘Make in India’ for the global market, fostering innovation and growth. We eagerly anticipate favorable developments that align with our vision for technological advancements, sustainability, and global market expansion.”
Sulajja Firodia Motwani, Founder and CEO, Kinetic Green: “As we anticipate the forthcoming Union Budget, we are eagerly looking forward to policy initiatives that will drive the green mobility agenda and foster sustainable practices. The country experienced a remarkable surge in Electric Vehicles (EVs) last year, and this can be attributed to the government’s proactive policy initiatives and support to energy transition and to EV acceleration, in particular.”
“As we welcome the Union Budget 2024-2025, we are optimistic that the Government of India will announce continued support to support demand for EVs with the announcement of FAME III scheme. The FAME scheme has been instrumental in reducing the price differential between EV and ICE vehicles, and thereby spurring demand from customers for EVs. This scheme has been the most successful demand generation incentive and the success of it can be seen in growing interest in and adoption of electric two- and three-wheeler from customers across the country. With help of Fame II, a large number of electric buses have been ordered and deployed in our cities, thereby reducing the menace of pollution. Thus, the most important expectation and demand from EV sector in the Union Budget 2024 is the continuation of demand incentive schemes for EVs with FAME III scheme. We strongly feel that if FAME II demand incentive scheme is suddenly discontinued in March 2024, there by leading to a significant increase in prices of EVs, it will lead to reduction of demand and as a country, we will lose momentum we have garnered towards a rapid transition to green transport. It may also lead to higher imports and loss of gains in Make in India for electric vehicles and their components. A clear and consistent demand generation roadmap is critical for continued and enhanced investments in e-mobility.”
“Further, including electric vehicle financing under Priority Sector Lending will help to provide impetus for affordable financing for EVs. We also request Government to create a strong export incentive policy for export of EVs, thereby encouraging local manufacturing of EVs for global markets. We anticipate policies that align with global sustainability objectives and position our country as a leader in the transition to electric mobility. Moreover, we are hopeful for a reduction in GST rates from the current 18 percent to 5 percent on lithium-ion batteries. This move by the GoI will bring about a positive impact on the EV industry. The upcoming 2024 budget is poised to mark a significant transformation for the electric vehicle industry. The industry eagerly anticipates a budget aligned with sustainable and net-zero development goals, fostering the growth of the electric vehicle sector, and contributing to a greener and cleaner future for India.”
Yatin Gupte, Chairman & Managing Director, Wardwizard Innovations & Mobility: “The visionary stance of the Union Budget 2023-24 towards sustainable mobility played a pivotal role in the successful realization of the target of 1 million electric two-wheelers, providing crucial support to the industry. Looking ahead to the Union Budget 2024-25, there is anticipation for a further boost in support for Electric Vehicle (EV) infrastructure in the country. Optimism surrounds the potential reduction in both input and output Goods and Service Tax (GST) for EVs and spare parts—a move that would significantly enhance accessibility and broaden the reach to the masses. Additionally, hopes are high for increased financing opportunities, propelling research and development to a larger scale. This, in turn, would open doors for substantial investments in the ecosystem, accelerating India’s overall adoption of electric vehicles. A crucial aspect lies in the call for added incentives specifically directed at Indian Original Equipment Manufacturers (OEMs), aiming to stimulate advancements in localizing EV technology, fortifying the indigenous industry, and contributing to a more self-reliant and progressive economic landscape for the industry.”
Ranjita Ravi, Co-Founder at Orxa Energies: “The Indian EV industry enthusiastically looks forward to increased collaboration with the government to deepen EV penetration and hasten clean mobility adoption across the country. We hope that the upcoming union budget addresses the disparity among EV types through technology-agnostic incentives and subsidies. Extending subsidies to child parts and sub-assemblies – and not just at the point of sale – will significantly reduce the BOM costs for these vehicles. Further, creating a cost-competitive environment for EVs through rationalised GST rates across all components, including spare parts (which are currently subject to higher levies), is crucial. This approach will also stimulate indigenous production of these vital components and discourage OEMs from exploiting loopholes to import these parts. Although all-electric vehicles have zero tail pipe emissions, the extent of their green quotient depends on the source of the electricity that powers them. To reduce their carbon footprint, all stops must be pulled to enhance access to renewable energy for battery recharging/ swapping facilities. Roof top solar, for example, is yet to gather momentum, and linking EV-charging incentives can bring more interest from industrial and residential complexes, corporate parks, malls etc. into this form of decentralised renewable energy. Furthermore, we hope for the government to implement robust policies based on battery lifecycle management principles. These measures could improve EV financing mechanisms, add longevity to battery life through second-life applications, and streamline recycling processes.”
Tushar Choudhary, Founder & CEO, Motovolt Mobility: “EV OEMs have successfully revolutionized the technologies and the potential of electric bicycles in India, and we will continue to support the growth of the green mobility ecosystem. Our cutting-edge e-bikes portfolio offers ample choices to fulfil diverse consumer needs, and we hope that coverage under FAME-III will help the e-bike makers conquer the final frontier of affordability and inclusivity in a much stronger manner in the years ahead! The upcoming Union Budget is expected to act as a catalyst for the Indian EV ecosystem. We have witnessed fantastic year-on-year growth of the market in the last few years, and recently there have been some apprehensions that the market might cool off a little in 2024 since the FAME-II is set to end by March, 2024. However, the recent announcement about FAME-III being in the works, has once again ignited hopes of a stronger than ever performance this year as well. We hope the Government will consider expanding EV subsidies, including e-bikes, under FAME-III to make electric mobility more inclusive. Higher financial incentives and priority lending support are crucial. Reducing interest rates on EV loans would enhance affordability, and grants or guarantees akin to World Bank and SIDBI initiatives can further boost growth. These measures are key to accelerating electric vehicle adoption in the country.”
Atul Gupta- Co-founder & Director, e-Sprinto: “We eagerly anticipate Union Budget 2024, recognising the undeniable surge in electric vehicle (EV) demand in India. With EV sales doubling from 2022 to 2023, reaching 89,137 units, the momentum is clear. To complement this growth, we urge a reduction in GST on lithium-ion battery packs and cells from 18% to 5%. Such a move will incentivize OEMs, fostering innovation and affordability in the sector. Additionally, the continuation of the FAME II Subsidy beyond its March 2024 expiration is crucial to sustain customer acceptance and support OEMs. Moreover, compulsory adoption of global ISO norms for battery swapping should be mandated by integrating voluntary IS standards into the Central Motor Vehicle Rules. This step will ensure quality assurance and uniformity in the EV industry, elevating standards for all stakeholders involved in the electric vehicle ecosystem. A forward-looking budget will not only propel the EV revolution but also solidify India’s position as a leader in sustainable mobility.”
Dr. Anshul Gupta, Managing Director, Okaya EV: “The electric vehicle (EV) industry is currently at the forefront of a transformative shift, largely fuelled by government incentives and subsidies. To ensure sustained growth and affordability, there is a collective expectation from EV players and analysts regarding the FAME (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) scheme and EV tax exemption in India. A pivotal demand is the alignment of input and output Goods and Services Tax (GST) rates for EVs & spare parts at 5%, creating consistency between input and output rates. This move would significantly contribute to making electric vehicles more accessible to a broader segment of the population. The call for additional incentives specifically directed towards Indian Original Equipment Manufacturers (OEMs) is another key aspect. By supporting domestic manufacturers, the government can catalyse advancements in EV technology and strengthen the indigenous EV industry. The FAME subsidy has proven instrumental in fostering industry growth. Sustaining and expanding this subsidy for the upcoming year is crucial, as it directly benefits consumers and encourages the widespread adoption of electric vehicles. These government initiatives, if upheld, have the potential to create a positive ripple effect, driving innovation among manufacturers and making EVs a more attractive option for consumers. In essence, a continued commitment to supportive policies can propel India further towards a sustainable and electric mobility future.”
Amit Raj Singh, Founder and MD, Gemopai: “As the year 2023 draws to a conclusion, the Indian automotive industry, among various segments, is optimistic about the upcoming budget and has been sharing their suggestions with the government. In fact, stakeholders in the automotive sector, particularly those operating in the two-wheeler category, are closely monitoring budget projections of the year 2024. They anticipate that the government will continue to provide incentives and support for the FAME scheme and electric vehicle (EV) tax exemptions in 2024 and beyond. Industry experts are calling for a more customer-centric approach to the scheme’s implementation, with benefits shared directly with end-users rather than original equipment manufacturers (OEMs). They are also suggesting lowering the goods and services tax (GST) on batteries to 5% to make EVs more affordable for customers. Furthermore, the experts are hopeful that the government will extend the FAME-II scheme beyond 2024 and offer attractive interest rates to financial institutions to promote EV funding, which will further stimulate the increased adoption of EVs in the country. As a result, the EV sector is hopeful about a slew of sops that will foster a conducive environment for the growth of electric mobility in India.”
