ACMA wishes that the new government fosters growth in the automotive sector by improving footfalls in auto dealerships. Excise rate cut in the interim budget needs to continue and interest rates reduced to make vehicle financing attractive for buyers. Introduction of Goods and Services Tax (GST) has the potential to revolutionise Indian manufacturing sector to make ‘made in India’ products cost competitive.
The new government needs to better infrastructure deficit focusing on power deficit here apart from speeding up building of highways to benefit automotive industry and improve connectivity, as well as overall inclusive growth.
Export-Import (Exim) policy’s should grow on long-term stable export promotion schemes with a 10 year term or more to make a shift from beinh a net importing industry and explore potential to service global exports markets. With labour laws in India being archaic, auto industry employs a sizeable number of contractual labourers, which is in noone’s best interest. Reforms to labour laws are welcomed as current state of affairs is not conducive to Indian auto industry growth and development.
P Balendran, Vice President, General Motors India said, “With a new stable government in place, we expect early implementation of second generation economic reforms like GST & DTC and speeding up of stalled infrastructural projects to revive the economy. A clear leadership at the center will give a much needed direction to the economy. Implementation of new labour reforms will lead to creation of jobs, especially in the manufacturing sector.”
“Customer sentiment is expected to improve in the medium to long term with a new government at the center. We expect the excise duty cuts to be retained in June’s budget and interest rates to fall or remain at current levels for any chances of recovery for the automobile sector during second half of the year,” Mr. Balendran added.