New Delhi, India – July 12, 2024, In a bid to accelerate the adoption of electric vehicles (EVs) and bolster the automotive sector, the Society of Indian Automobile Manufacturers (SIAM) has appealed to the government for robust incentives in the upcoming Budget. Emphasizing the need for a growth-oriented approach, SIAM has highlighted the importance of enhancing capital expenditure to stimulate economic momentum.
SIAM President Vinod Aggarwal, addressing the press in New Delhi, underscored the industry’s expectations from the government, particularly urging for a policy framework akin to the FAME 3 (Faster Adoption and Manufacturing of Electric Vehicles) scheme. “We are expecting that the government should come up with a FAME 3 like policy… Good schemes like PLI are already in place, which we are sure will continue,” remarked Aggarwal.
The FAME 3 scheme is anticipated to provide financial incentives aimed at promoting electric two-wheelers, three-wheelers, and government-owned buses. It is poised to succeed the Electric Mobility Promotion Scheme (EMPS), which concluded with the end of the FAME 2 scheme on March 31, 2024.
Aggarwal also stressed on the need for enhanced incentives under the vehicle scrappage policy. “And so therefore, to give further boost to the scrapping of old polluting vehicles, I think something needs to be done,” he added. Aggarwal emphasized the government’s role in fostering initiatives beneficial to the economy.
“We anticipate that it will again be a growth oriented Budget…Which means it will be more focused on the capital expenditure, because that has a multiplier effect on all segments of the economy,” he stated.
Allocation for the capital expenditure in the Interim Budget stood at Rs 11.1 lakh crore which was 11.1 per cent higher than the previous year allocation, Aggarwal stated.
“So, we are expecting that the focus on allocating more and more capex will continue,” he said.
Aggarwal also urged the government to come up with some policy initiatives to boost the rural economy. “It will be good for sectors like automotive and FMCG and others if the rural economy starts doping better,” he added.
The automotive sector, grappling with various challenges including economic slowdowns and supply chain disruptions, looks to the Budget for substantial measures that could rejuvenate demand and invigorate production capabilities. SIAM’s recommendations align with the industry’s broader objectives of sustainable growth and technological advancement.
As preparations for the Budget gain momentum, stakeholders in the automotive sector eagerly anticipate proactive measures from the government to bolster the industry’s resilience and competitiveness in the global market.
