Auto industry welcomes Budget 2022

The automobile industry has given an enthusiastic response to the Union Budget 2022 presented by the Finance Minister Mrs Nirmala Sitharaman in Parliament on February 1. Prominent industry bodies and key stakeholders have lauded various provisions of the growth-oriented Budget.

The following is the feedback of the industry:

Mr Kenichi Ayukawa, President, SIAM: “SIAM welcomes a growth-oriented Budget focused on building long-term strength using Investment as the growth lever while maintaining policy stability and inclusivity. The 35% increased capex outlay, major infrastructure projects like 25,000 km road construction, 100 Cargo terminals, Project GatiShakti, 5G network, optic fibre cable laying and the recent PLI schemes are major positives. Leveraging Biomass and support to ethanol blending for both environment and economy gains could unlock the power of India’s rural economy. Steel price cooling off measures will help the entire manufacturing sector. Impetus to charging infrastructure and energy storage systems and Government support in R&D for clean energy, green mobility and semiconductors will help the auto sector. We welcome the message on Ease of Doing Business and look forward to this being observed in spirit by all departments.”

Mr Sunjay J Kapur, President ACMA: “The blueprint of a digitally enabled, Aatmanirbhar Bharat, coupled with measures that will drive sustainable yet inclusive growth at a rapid pace for the next twenty-five years. These are the bedrock of the proposals announced in the Union Budget 2022-23, as we redefine our economy in a post-pandemic world. Setting the direction for creation of urban fossil fuel free zones, policy for battery swapping and energy as service and incentives for creating a vibrant start-up eco system, India could soon emerge as a fore-runner of green mobility solutions for the world.

“ACMA is also delighted by the measures announced for the MSMEs. The auto component industry is dominated by small players and the extension of the ECLGS (Emergency Credit Line Guarantee Scheme) and its cover, revamping and infusion of funds into the Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE) scheme combined with the Raising and Accelerating MSME Performance (RAMP) program will help the MSMEs stay relevant and competitive”. 

Mr Vinkesh Gulati, President, FADA: “Union Budget 2022 seeks to lay the foundation for the next 25 years, from India@75 to India@100. With PM’s ‘Gati Shakti National Master Plan’, a Rs 100-lakh crore project for building comprehensive infrastructure in India, it will be a significant step towards path to development. The Budget has attempted to focus on each of the sectors and has also tried to stimulate the economy after the pandemic slowdown. FADA welcomes and supports the Government’s efforts and initiatives towards Electric Mobility. There is a clear emphasis on creative, sustainable & innovative business models. Battery Swapping & Energy as a Service (EAAS) will surely help accelerate the transition towards Clean Mobility. The development of special mobility zones for electric vehicles and promoting clean technology for public transport validate government commitment to E-mobility, which would boost confidence in the EV industry in terms of manufacturing, sales, and create a sense of assurance among customers.”

Mr Sohinder Gill, Director General, SMEV: “We welcome the measures announced by the honorable Finance Minister. The Budget for 2022–23 gives a huge impetus to the electric vehicle (EV) industry. Introducing the battery swapping policy and recognizing battery or energy as a service will help to develop EV infrastructure and increase the use of EVs in public transportation. It would motivate businesses engaged in delivery and car aggregation businesses to incorporate EVs into their fleet. It will create new avenues for companies to venture into the business of battery swapping. Additionally, creating special clean zones will further accelerate the adoption of  EVs and spread awareness amongst the citizens. The move will benefit the whole segment, i.e E2W, E3W, E-cars, and buses.”

Mr. Unsoo Kim, MD, Hyundai Motors India: “Hyundai Motor India welcomes the progressive Union Budget. Government’s strong approach towards accelerating infrastructure development, sustainability along with digitalisation in every-sphere of business will give strong impetus to overall economy while empowering consumerism in India. The vision for clean mobility creating electric vehicle ecosystem is a positive indicator for auto Industry and for its large supply chain. The forward looking budget will lay modular economic structure for every section of business and society in India.”

Mr Venu Srinivasan, Chairman, TVS Motor Company: “Union Budget 2022 sets the pace for the Indian economy’s growth trajectory amidst the challenges brought forth by the pandemic. The big boost to capital expenditure is welcome and it would give a fillip to the Indian economy.  For the automobile sector, we welcome the ‘PM Gati Shakti Master Plan’ focusing on building world-class infrastructure and improved connectivity for commuters. The strong push towards augmenting agricultural productivity should help enable buoyant rural demand.  In the electric mobility space, we strongly support the measures undertaken by Government to promote clean and green mobility, mainly introducing the battery-swapping policy will be instrumental in supporting an efficient EV ecosystem.”

Mr PB Balaji, Group CFO, Tata Motors: “Budget 2022 is an articulation of purposeful intent enabled by a clear action plan. Building on the excellent budget of last year, the government has wisely continued on the path of prioritizing economic growth with calibrated fiscal prudence. For the Indian automobile sector, which is a significant contributor to the nation’s GDP, the budget offers continuity and also additional opportunities to drive multi-year growth.

 “Specifically, the robust increase in capex by 35.4% to Rs. 7.5 lakh crore and a comprehensive investment plan for infrastructure is a significant growth booster. Additionally, the launch of the well-conceived PM Gati Shakti program for multi modal transport including 100 cargo terminals and investments in 25000Kms of highways, apart from investments in ports and metros is an excellent development that will help create a world class transport infrastructure in the country. This will reduce logistics costs and transit times, increase employment and make us globally competitive with avenues for better and efficient mobility solutions. Additionally, plans to create EV charging infrastructure including national policy for battery swapping which when combined with the already announced Automotive PLI scheme, furthers the agenda for green mobility. Tata Motors welcomes this balanced, thought-through Budget.”

Mr. Satyakam Arya, MD & CEO, Daimler India Commercial Vehicles: “Fundamentally, the FY 2022-23 Budget focuses on providing growth to the economy. We have already started to see some green shoots in the economic recovery and therefore a budget focused on that is a welcome step. The honorable FM has also not taken an aggressive target on reducing the fiscal deficit and, this also provides the headroom for spending and capital expenditure to enable the growth momentum on sustainable basis. Some of the highlights are 35.4% increase in CAPEX outlay to INR 7.5 lakh crore, the high-level fiscal target of 6.4% for 2022-23, a sharper focus on building road infrastructure and logistics and a bigger push towards e-mobility are big boosts for the economy.”

Mr Nagesh Basavanhalli, Group CEO & MD, Greaves Cotton Limited: “The Union Budget 2022 has some important announcements to accelerate economic growth by focusing on four core pillars of productivity, climate action, financing investment and PM Gati Shakti Programme which will help strengthen our infrastructure and MSME sector. The expansion of the National Highway network will provide better connectivity to our towns and cities and strengthen the supply chain network. Overall, huge impetus on rural growth through various schemes and technological intervention will help create more rural jobs and thereby create more demand from rural and semi-urban areas. The production linked incentives in several sectors announced by the government will help create more employment opportunities for the people.”

Mr. Sanjay Thakker, Chairman & Founder, Group Landmark: “Landmark, growth-oriented and visionary Budget focused on capex. The decision to engage in major infrastructure investments with an emphasis on the rural economy will boost automobile businesses in the long run. Commercial electric vehicle (EV) manufacturers will profit from announcements such as the battery swapping policy, and this is likely to add confidence to potential passenger EV buyers too. The automobile component players will likewise get access to a new source of revenue and a completely emerging business sector where they can participate. The move to open up defence R&D to private businesses might pave the way for new development opportunities for Indian automobile component manufacturers.”

Mr. Jeetender Sharma MD & Founder, Okinawa Autotech: “The Union Budget 2022-23 provides great encouragement for the EV sector. The introduction of the battery swapping policy to improve the country’s EV infrastructure is a positive and progressive step that could potentially address the range anxiety issue, which is one of the impediments to a mass-market transition from internal combustion engine-based vehicles to electric vehicles. This policy will be critical in enabling a well-established EV infrastructure across the country while instilling customer confidence in riding EVs on Indian roads. More importantly, this will boost EV adoption in the last-mile delivery space, where time constraints make instant battery swapping more viable than charging the existing battery.”

Mr Anil Kumar, President & Managing Director, SEG Automotive India Private Limited: “We welcome the Budget announced by the Government. The focus on inclusive growth should support the Indian economy to continue to grow stronger. The announcements related to battery swapping policy highlights the focus towards sustainable mobility and can improve the demand in the growing EV segment. Offering energy as service and battery swapping can lead to new innovative business models, making electric mobility more attractive on TCO, by reducing the acquisition cost of the vehicle. The robust allocation of capital expenditure is a good sign for the infrastructure, manufacturing and commercial vehicle sector. The credit schemes for the MSME, and reduction in duties for a few commodities is a much-needed move, for the industry to stay competitive, at a time when the commodity prices are increasing.”

Mr. Rajesh Gupta, Founder & Director, Nupur Recyclers: “We welcome the Government’s proposal to introduce a battery swapping policy and interoperability standards for the electric vehicle sector. Consumers will be able to seamlessly switch the battery on-the-go without worrying about running out of charge, which is especially useful when out for the day. Furthermore, this policy encourages companies like ours to continue developing efficient solutions to power India’s EV Revolution, as well as opens up new growth opportunities through the Energy-as-a-Service model, which is expected to explode in popularity in the coming years.”

 Mr. Amarjit Sidhu, Executive Director, Detel: “The Union Budget for 2022 carries a positive message for the EV sector. More efforts than ever are being made by the government towards boosting the EV ecosystem. It’s very encouraging to see this renewed dedication, and it also looks like there are some promising initiatives in store for 2022 with this budget. The Indian government’s recent policy to allow the swapping of electric vehicle batteries is a step in the right direction. This new policy will help get more people to buy electric vehicles and will work to increase battery recycling, thus helping build infrastructure for electric vehicles. Turning the most expensive EV component—the battery—into an operational cost, will significantly reduce the prices of electric vehicles and promote their adoption.

Dr. Yogesh Bhatia, Managing Director & CEO, LML Electric: “The Union Budget 2022’s four key pillars of inclusive development, productivity improvement, energy transition, and climate action will undoubtedly boost the country’s economic growth. Clean and sustainable mobility is critical for reducing fossil fuel dependence and combating climate change. We applaud the government’s efforts in this area and look forward to seeing concrete steps taken to address the barriers to EV adoption. India’s electric power is increasing! Special mobility zones with a zero-fossil-fuel policy will aid in the transition to cleaner technologies and the development of a more sustainable economy. I look forward to seeing the positive impact electric vehicles will have on India and the planet. “

TKM spokesperson: “At Toyota Kirloskar Motor, we welcome the forward-looking Budget that has clearly outlined Government’s long term objectives of focusing on growth, inclusiveness, promoting technology enabled development, productivity enhancement, energy transition & climate action. The Budget has sought to achieve a fine balance between fiscal consolidation with the need for continued public spending for nurturing economic growth with clear emphasis of on sustainability and infrastructure development through public-private partnerships.”

Mr. Banwari Lal Sharma, CEO Consumer Business, CarTrade Tech: “The Honourable Finance Minister has proposed implementing a much-needed Battery Swapping Policy. This policy would encourage the widespread usage of batteries in mobility and eventually bring down the cost of electric vehicles (EVs), boosting consumer confidence in the nascent technology. Cities with zero-emission zones will assist in raising the prominence of EVs while also providing people an incentive to buy them, even as battery swapping availability/access will reduce range anxiety. This will furthermore provide prospects for a number of new automotive businesses and start-ups to grow and flourish in India.”

Mr. Nishant Arya, Vice-Chairman, JBM Group: “This is an investment focused Budget aimed at creating India@100. JBM Group welcomes the Government’s move towards promoting electrification of vehicles by proposing the Battery Swapping policy which also includes the concept of Energy and Battery Storage as a Service. This is going to intensify the deployment of an extensive network of EV chargers, thereby, boosting the end-to-end EV ecosystem pan India. In fact all the 7 engines of PM Gati Shakti – Roads, Railways, Airports, Ports, Mass transport, Waterways and Logistics infra reflect positively towards the automotive and transport sector. However, bringing the EV financing under priority lending could have bought about the much needed liquidity into the EV sector, which has been missed in the budget this year”.

Mr Mohal Lalbhai, CEO and Founder,  Matter: “The Union Budget 2022-23 has made a strong case for furthering clean energy, it encourages a sustainable future for India and has been drafted keeping in view of the climate change impact, as pointed out by our Honorable Prime Minister during the COP26 Summit held in Glasgow. The initiatives announced towards greater adoption of electric mobility by strengthening EV charging especially the introduction of policy for battery swapping infrastructure is encouraging. Energy being the key progress enabler, so the announcement on the energy storage system being given infrastructure status is important as it will fuel not just the electric mobility sector but will give a necessary boost to the economy as well. Another positive step by the ministry is the extension of the tax exemption for start-ups till March 2023. Summing it up, we strongly believe that the initiatives announced will boost a sustainable future for India and help the nation achieve its broader decarbonization goals with greater contributions coming from start-ups.”

Mr Saurav Kumar, Founder and CEO, Euler Motors: “Proud as an Indian and energised by the forward-looking mood of the Budget. The Government continues to also keep fundamentals in mind for collective progress for India to set examples for the world. The focus on clean energy is a critical measure that will benefit both citizens as well as the planet. The Budget 2022 is pragmatic that brings thrust on clean technology, encourage a shift in mobility, and achieve decarbonisation. These steps will help accelerate growth of EVs across segments.” 

Mr. Ketan Mehta, Founder & CEO, HOP Electric Mobility: “Overall, this is a good Budget for electric vehicles and charging/swapping infrastructure in India. The measures under PM Gati Shakti will boost and give the necessary push to job opportunities in every sector. Policy measures announced on battery swapping will help in the wide-scale adoption of ‘batteries as a service’. Will be happy to see the reduction in ownership costs of electric vehicles with this announcement. Since the cost of running electric vehicles is a practical alternate mode of mobility, the government’s intent to improve the charging ecosystem will help ease migration to EVs, which are more economical than the usage of ICE- vehicles. We see this creating opportunities for several new start-ups. We strongly believe and support the clean and green energy mission.”

Mr. Arun Sunny, Founder & CEO, Trouve Motor: “The Budget considers and touches all areas of growth and well-being of its citizens. Good initiative to promote Battery swapping policy, and inter operable policy to be formulated will bring down the cost of Electric Vehicles down drastically and also will make the adoption of EVs faster. Electric Vehicles in Urban, Battery and Energy as a service will bring in more investment and faster infrastructure building.”

Mr. Parag Satpute, MD, Bridgestone India: “This is a forward-looking Budget that focuses on not only the economic health of the country but also takes into account physical and mental health. This is indeed a major milestone in India. The PM Gati Shakti plan and the corresponding announcement of additional 25, 000 km of roads will spur growth in the mobility sector. Government’s initiative on electric vehicles and the announcement on a battery swapping policy is a major boost to the nascent EV sector and will boost customer confidence in EVs”