Finance Minister Nirmala Sitharaman presented Interim Budget 2024 today, which may seen as one of the shortest budget presented by her since 2019. While almost everyone had some or the other expectations from the Interim Budget 2024, some were happy, some were disappointed.
Sitharaman maintained a discipline by not presenting a populist budget, but there were certain pointers which may present direct and indirect opportunities for the Indian automotive sector.
Let us take a close look and try and decode some of the parameters.
Rajeev Singh, Partner and Consumer Industry leader, Deloitte Asia Pacific says the Interim Budget 2024 signalled two key points for the automotive sector.
The first is the focus on four pillars – Gareeb, Yuva, Anandata, Naari (GYAN) – of which at least three pillars will drive the revival of the rural economy and, in turn, help drive consumption of small cars and two-wheelers. The continued focus on CAPEX and infrastructure will continue to augur well for the commercial vehicle segment.
Then there is the focus on zero-emission vehicles. This he says can be seen by the Minister’s statement on rooftop solarisation which will create entrepreneurial opportunities for the EV charging ecosystem; also mentions the payment security mechanism for adoption of e-buses.
In addition, there is also the mention of biogas blending in CNG in the transportation segment, indicating a clear focus on reducing carbon emissions in the automotive sector.
Furthermore, while the Finance Minister didn’t spell out the individual segments, the allocation of Rs 1 lakh crore corpus towards ‘Sunrise Domains’ will give a strong boost to the electric vehicle and clean energy segment.
“For our tech savvy youth, this will be a golden era. A corpus of R 1 lakh crore will be established with 50 year interest free loan. The corpus will provide long-term financing or refinancing with long tenors and low or nil interest rates. This will encourage the private sector to scale up research and innovation significantly in sunrise domains. We need to have programmes that combine the powers of our youth and technology,” she said.
In all, this translates to not only drive innovation and promotion of electric vehicles, but also alternate fuel and clean energy technologies.
