Union budget 2022 has been released. We pitch you through the details and how it will affect the Indian auto industry.
Presented by honorable finance minister Ms. Nirmala Sitharaman; the union budget for FYI 2022-23 has landed. Concerned with every sector of the Indian economy, this new budget has also brought changes for the auto industry. Are these changes good or not? Read below in our detailed report.
The Good of Union Budget
1. Rs 20,000 Crore sanctioned for Infrastructure
The government has sanctioned a hefty Rs 20,000 crore budget for the expansion and development of new infrastructure. The main aim is to concentrate on safe travel over Indian roads. GOI also plans to expand the road network of national highways by 25,000 kilometres by FYI 2022-23.
2. Battery Swapping Policy
Electric vehicle push has been strong from the government and in order to provide more services, GOI has presented a battery swapping policy. This policy will able the private players to offer services such as battery swapping stations. They are also obliged to work on further technological advancements for EVs. This move will provide EV users with a fast way to swap for new batteries on-road, thus saving time and maintenance.
3. Rs 2.73 Lakh Crore MSP Payment
Covid-19 hit India has seen the worst economic effects on rural areas. Auto sales have dipped disastrously in rural areas for the past two years. To boost the sales in third-tier cities; GOI has sanctioned a budget of Rs 2.73 Lakhs Crore to enrich the sentiments of rural buyers. This will focus on the sales of budget two-wheelers, agricultural auto products such as tractors and small commercial vehicles.
4. EV Introduction for Public Transport
Although, already been introduced in megacities such as Delhi, Mumbai, Bangalore, Chennai; GOI plans to completely overhaul Indian public transport by replacing the diesel guzzlers with EVs. Not just buses but also small EVs are welcome to be used by the government. GOI has urged private players to develop such EV public transport carriers that can solve the purpose without pollution.
The not so good...
No Rebate in Taxes for New Vehicles
Ironically no matter how much government wishes to support the auto industry; over the past few years vehicles have become significantly costlier than required.
Consistent strains of stricter emission norms, new safety-based laws being introduced and the growing competition has pushed manufacturers to increase the prices of their products. This has resulted in unjustified pricing for many products. Even Toyota admitted last year that they do not intend to expand their portfolio because of the hefty tax policies.
Union budget FYI 2022-23 has left manufacturers craving for more subsidies and tax rebates for providing good products at reasonable costs.
Also Read - 2022 Audi Q7 Review - Still The Best Luxury 7 Seater SUV?
So, what do you think about the newly sanctioned budget? Tell us by commenting below.
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