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New Delhi, Jan 26 () Leading industry body Indian Auto LPG Coalition has sought GST reduction on Auto LPG as well as on conversion kits for gaseous fuels to promote the adoption of clean automotive fuels.
LPG used as fuel in automobiles or Auto LPG, which is among the cleanest alternative fuels with a Global Warming Potential of 'zero' is currently taxed at 18 per cent GST. Also, the GST rates on Auto LPG/CNG conversion kits stand at a prohibitive 2 per cent, IAC said.
High GST rates on clean fuels and conversions kits are in complete variance to the government's stated green mobility push, it said in a statement.
"We seek the attention of Finance Minister Nirmala Sitharaman towards the imminent need for devising friendly policies to allow rapid growth of environment-friendly transport fuels such as Auto LPG. Auto LPG which is being promoted actively by governments across the world is facing discriminatory policies in India. It is taxed at a high GST slab of 18 per cent. Similarly, conversion kits for auto LPG and CNG are placed at the highest slab of 28 per cent which is meant for either luxury goods or demerit items like tobacco products," said Suyash Gupta, Director General, Indian Auto LPG Coalition (IAC).
IAC said LPG is the most widely used alternative fuel in the world, with a proven track record of improvement in air quality.
The global consumption of Auto LPG has risen by over 40 per cent over the past 10 years, fuelled by environmental concerns. Among the key nations that have successfully adopted this green fuel for their transportation requirements are South Korea, Turkey, Poland, Japan, Australia, Italy, Mexico and Russia.
The association said even as India plans a long-term shift to electric vehicles, it is missing out the environmental benefits that can be gained by adopting low hanging fruits like Auto LPG. Investing in a wider basket of clean alternative transport fuels that are more readily available can bring about an immediate improvement in air quality unlike EVs that are still a decade away from becoming commercially viable.
"Apart from the need to lower GST, another critical intervention required is the reform of the Type Approval norms governing conversion to gaseous fuels. The Type Approval norms require companies to renew extremely cost prohibitive Type Approvals for Auto LPG and CNG conversions every three years. This acts as a major hurdle to the industry and has resulted in a rapid dwindling of players in the retro-fitment market. The Type Approval regime must be made industry friendly and its validity must be made perpetual in line with European norms," Gupta said.
More than 26 million vehicles run on Auto LPG globally, supported by close to 71,000 LPG Filling Stations with global Auto LPG consumption exceeding 26 million tonnes. Emissions of harmful nitrogen oxides (NOx) and harmful particulate matter PM 2.5 are almost negligible for Auto LPG, claimed IAC.
IAC is the nodal body for the promotion of Auto LPG in India. Members of the Coalition include the oil PSUs, private auto LPG marketers, kit suppliers and equipment manufacturers. The coalition works closely with the World LPG Association, Society of Indian Automobile Manufacturers and Automotive Research Association of India. ANZ MKJ

Slash GST on Auto LPG, address policy issues stalling growth: Industry body to FM

New Delhi, Apr 17 () Auto industry body SIAM on Friday said it has sought temporary GST rate cut on vehicles and introduction of incentive based scrappage policy from the government at the earliest in order to revive the sector amid the coronavirus pandemic. While appreciating RBI's announcement to support NBFCs and MSME sector by infusing liquidity in the system, the Society of Indian Automobile Manufacturers (SIAM) sought several 'key interventions' for the the auto sector. "COVID-19 has left the Indian economy and automobile industry in deep distress and financial support and demand revival is a necessity," SIAM President Rajan Wadhera told . COVID-19 is an unprecedented situation and hence requires unique measures, he added. "SIAM is hopeful that the lending rates would be slashed substantially for consumers to benefit in these challenging times," he added. In order to revive the auto industry, SIAM has sought temporary reduction in standard GST rate by 10 per cent across all vehicle categories, auto components while maintaining the current product segment GST rate differential, Wadhera said. The auto industry body has also sought introduction of incentive based vehicle scrappage scheme to generate demand. "The incentives can be in the form of 50 per cent rebate in GST, road tax and registration charges," he added. SIAM has also asked for fund allocation for diesel/CNG bus procurement by state transport undertakings, over and above the allocation for electric buses under FAME 2 scheme, Wadhera noted. Besides, it has also asked to expedite release of all pending payments to vehicle manufacturers and contractors of highway and infrastructure projects against past procurement by central government and other agencies to increase liquidity in the system, he added. Wadher said SIAM has also asked for fast track disbursement of all government incentives and benefits to all industries. "The automotive industry is the backbone of manufacturing sector in India in terms of employment and contribution to GDP, and its revival will be critical for the manufacturing sector and economy of India," he added. MSS RVK

COVID-19: SIAM seeks GST rate cut, incentive based scrappage policy to revive auto sector

New Delhi, Jan 27 () Auto industry body SIAM on Monday urged the government to announce an incentive based scrappage policy ahead of the Budget, while also seeking a reduction in GST on BS-VI vehicles to 18 per cent.
Society of Indian Automobile Manufacturers (SIAM) also suggested Finance Minister Nirmala Sitharaman to increase budget allocation for internal combustion engine (ICE) bus procurement by state transport undertakings.
"As SIAM, we have urged the Finance Ministry to consider announcing an incentive based scrappage policy and also increase Budget allocation for ICE bus procurement by State transport undertakings," SIAM President Rajan Wadhera said in a statement.
He further said increased cost of BS-VI vehicles may effect demand.
"Hence, we have also requested government to reduce GST rates for BS-VI vehicles effective April 1 from 28 per cent to 18 per cent," Wadhera added.
From April 1, India will transition to stricter emission norm BS-VI from the current BS-IV. As per industry estimates, BS-VI vehicles are expected to be at least 10 per cent costlier.
The Indian auto industry has been going through a prolonged slump, recording its worst-ever sales decline in two decades in 2019, with an unprecedented slowdown hampering vehicle offtake across segments.
Overall, wholesale of vehicles during the year across categories, including passenger vehicles, two-wheelers and commercial vehicles, saw a decline of 13.77 per cent in 2019 at 2,30,73,438 units as against 2,67,58,787 units in 2018.
Seeking a turnaround in fortune, the auto industry has been seeking government support and reduce the burden of transition to BS-VI with lower GST rate. RKL BAL

SIAM seeks incentive based scrappage policy, GST rate cut on automobiles

<keyword id="42747" type="CITY" weightage="100" keywordseo="Tata-Motors">Tata Motors</keyword> has announced its decision to reduce the prices of its passenger vehicles in a range of Rs 3300 to Rs 217000. "This will enhance the ease of doing business and usher in a new era for the economy in general and especially, for the automotive industry. Following the roll out of GST, we have decided to pass on the entire benefit to our customers. We are offering a price reduction of upto 12% ranging between Rs 3300 and Rs 217000 depending on the model and variant. With a strong focus to encourage positive buying sentiments, we have taken this step," said <keyword id="162478" type="PERSON" weightage="100" keywordseo="Mayank-Pareek">Mayank Pareek</keyword>, President, Passenger Vehicles Business Unit.

Tata Motors passes on GST benefits to customers; slashes prices by 12 %

<ul><li>With their sales being hit, the Indian business community which has so far been an active supporter of the Indian government, has been raising its voices.</li><li><keyword id="6359432" type="UNKNOWN" weightage="20" keywordseo="britannia">Britannia</keyword>’s MD Varun Berry said there is some serious issue in the economy.</li><li>He’s not alone, leaders from the auto industry have raised their concerns as the segment is witnessing its worst sales slowdown.</li></ul>Questions are being raised by top Indian businessmen about the economic health of the country. The latest one to cry foul is fast moving consumer goods company Britannia. In the <a href="https://www.dnaindia.com/business/report-consumers-thinking-twice-before-buying-a-rs-5-pack-britannia-2781047">latest earnings call</a> of Britannia, the company’s MD Varun Berry raised some serious concerns about the <keyword id="6356076" type="DEFINITION" weightage="20" keywordseo="indian-economy">Indian economy</keyword>. "We've grown only 6% and the market is growing slower than that. And that's a little bit of a worry, because even for a ₹5 product if the consumer is thinking twice before buying it, then there is some serious issue in the economy,” he said. This comes in even though Britannia holds one-third of market share in the Indian biscuit industry. With their sales hit, the Indian business community which has so far been an active supporter of the Indian government, has been raising its voices. India’s GDP has slumped to 6.8% in FY19, whereas <a href="https://www.businesstoday.in/current/economy-politics/india-economy-9-per-cent-gdp-growth-pm-modi-5-trillion-dollar-economy-target-ey/story/370433.html">analysts </a>say that for India to reach its dream of being a $5 trillion economy, the country’s GDP needs to grow steadily at 9%. The industry that has been worst hit has the auto industry which has seen a massive slowdown in sales has seen. Auto industry leaders like Pawan Munjal of HeroCorp, RC Bhargava of Maruti, Anand Mahindra of Mahindra &amp; Mahindra, have all been rallying for reduction of GST to boost growth in sales. Rahul Bajaj, the chairman of Indian conglomerate Bajaj Group. During his company’s Annual General Meeting, he spoke of the government’s role in the weak sales of the auto industry. “There is no demand and no private investment, so where will growth come from? It doesn’t fall from the heavens. The auto industry is going through a very difficult period. Cars, commercial vehicles and two-wheelers are going through a rough patch,” Bajaj added. Earlier, Adi Godrej, chairman of the Godrej group, too <a href="https://www.firstpost.com/business/industry-leaders-reaction-on-budget-2019-adi-godrej-says-budget-is-not-growth-oriented-stock-market-comes-down-considerably-6940161.html">said</a> that the Budget presented by Finance Minister Nirmala Sitharaman is not “growth-oriented”. <a href="https://www.ndtv.com/india-news/adi-godrej-rising-intolerance-hate-crimes-can-seriously-damage-growth-2068996">Godrej also touched upon a sensitive subject </a>saying that rising intolerance in the country is also affecting growth. However, there are also some who believe this is just a phase. HDFC Chairman <a href="https://www.businesstoday.in/current/economy-politics/indias-economic-slowdown-driven-by-lower-consumption-temporary-in-nature-says-hdfcs-deepak-parekh/story/370229.html">Deepak Parekh</a> in the recent annual general meeting of the bank said, “While there has been an across-the-board slowdown in consumption, given the inherent demand and low penetration levels, I believe this is temporary in nature.”

Forget cars, Indian consumers are wary of buying a ₹5 biscuit packet

New Delhi, Jan 12 () In middle of a prolonged slowdown, the automobile industry has asked the government to take bold fiscal measures to revive the sector that has reported its worst-ever sales decline in two decades during 2019, industry sources said.
 In the upcoming Union Budget, the auto industry has sought measures, such as reduction in GST rates on vehicles and abolition of duty on import of lithium-ion battery cells, to encourage electric mobility.
 The industry, which has been facing a downturn for almost a year now, has also sought an incentive-based scrappage policy and an increase in re-registration charges of vehicles to discourage use of old vehicles.
 Sources said that the introduction of BS-VI emission norms is a positive step to reduce emissions significantly but the initiative would lead to an 8-10 per cent increase in vehicle cost, leading to enhanced GST collections for government.
 "However, this extra cost would lead to a fall in demand. As a win-win situation, we are requesting the government to consider reducing GST on BS-VI vehicles to 18 per cent from the current 28 per cent from April onwards," an industry source said.
 The decision-making power for GST reduction lies with the GST Council and not related to the Budget directly but this is an important element for demand revival, he added.
 The auto industry is also scrapping duty on import of lithium-ion battery cells so that battery packs can be manufactured locally and progressively cell manufacturing can also be established in the country.
 It would also help in reducing cost of electric vehicles and aid in accelerating adoption of green mobility in the country, another source said.
 He added that a formal incentive-based scrappage policy with monetary support from the government as well as manufacturers is required to take old vehicles off the roads and generate demand for new vehicles.
 "Incentive in the form of 50 per cent tax rebate in GST, road tax and registration charges is proposed," the source noted.
 The industry has also sought adequate Budget allocation for the Ministry of Urban Development to support state transport undertakings in procuring buses.
 "Robust public transportation will reduce the number of vehicles on the road, thereby will reduce pollution and hence positively impact climate change. This would also lead to reviving demand for commercial vehicles which is very much needed in the current economic scenario," the source said.
 Besides, the industry has asked increase in depreciation rate on passenger vehicle and two-wheelers to 25 per cent to have depreciation aligned to real useful life of the vehicle.
 Similarly, it has asked the government to permanently withdraw the proposed hike in the vehicle registration fee as a higher fee would further impact the demand negatively.
 "Besides, we are seeking income tax benefits on the interest part of vehicle loan to be provided to individuals purchasing green vehicles," the source noted.
 The automobile industry recorded its worst-ever sales decline in two decades in 2019, with an unprecedented slowdown hampering vehicle offtake across segments.
 According to data released by the Society of Indian Automobile Manufacturers (SIAM) last week, all vehicle segments reported de-growth last year as low consumer sentiments, weak rural demand and economic slowdown took toll on demand.
 Overall wholesale of vehicles during the year across categories, including passenger vehicles, two-wheelers and commercial vehicles, saw a decline of 13.77 per cent in 2019 at 2,30,73,438 units as against 2,67,58,787 units in 2018.
 This is the worst fall in sales since the industry body started recording monthly and yearly sales data in 1997. The previous lowest was recorded in 2007 when overall sales had declined by 1.44 per cent. MSS HRS

Auto industry seeks bold fiscal measures in the Budget to revive growth

<ul><li>The sharp slump in car sales has squeezed profits in India’s auto sector, which employs 32 million people. </li><li>Half a million passenger vehicles worth $5 billion, are lying unsold at dealerships. </li><li>The automobile sector currently attracts 28% GST slab. </li><li>Seven of the top ten auto manufacturers like Maruti Suzuki, Tata Motors and Mahindra have announced factory shutdowns. </li></ul>The newly appointed Finance Minister Nirmala Sitharaman is mulling taking a few items off the list which attracts the highest tax under India’s goods and services tax (GST) regime. And, auto sector, which has been weighed down by piling inventory and sales slowdown, is most likely candidate, according to an <a href="https://economictimes.indiatimes.com/news/economy/policy/more-items-likely-to-go-off-highest-gst-slab/articleshow/69718462.cms">ET report</a>. Currently, the automobile sector attracts 28% GST along with personal-use aircrafts, lotteries and five-star hotels and unhealthy foods like aerated water. The sector <a href="https://www.bsmotoring.com/news/domino-effect-of-auto-crisis-livelihoods-indias-gdp-growth-may-take-hit/17095">employs around 32 million people</a> across the country, directly or indirectly, and has been the single-greatest engine of economic growth across the world. Any benefits that flow into the sector, trickles down to every sector. As the government looks to create employment, this sector which is capable of moving the growth engine, is seen as a favourite. Right now, the sector is facing shutdowns after a long spell of slowdown. This will have a much deeper effect on the employment in the sector which employs skilled and unskilled workers. As per the latest data, <a href="https://www.businesstoday.in/sectors/jobs/jobless-in-motown-employment-auto-industry-fell-2017-18/story/336097.html">hiring in the sector</a> went down by 2.5% in 2017-18 annual data. Unsold inventory at $5 bn According to<a href="https://economictimes.indiatimes.com/industry/auto/auto-news/auto-companies-slam-brakes-on-production/articleshow/69718548.cms"> an ET report</a>, seven of the top ten auto manufacturers like Maruti Suzuki, Tata Motors and Mahindra have announced factory shutdowns. Almost half a million passenger vehicles worth $5 billion, are lying unsold at dealerships. As many as 3 million two-wheelers valued at $2.5 billion are unsold too. Auto dealers too have been shuttering down as they are unable to move cars from the showrooms. In the slow lane For the month of April, the Indian auto sales declined by almost 16% annually, according to the Society of Indian Automobile Manufacturers (SIAM). All the segments like commercial and passenger vehicles, two wheelers moved to the red. The wholesale passenger vehicle sales segment went down by 17%, impacted by various factors. “Passenger vehicles sales volume declined due to the weak buyer sentiments on account of higher insurance premiums, the increase in fuel prices as well as the interest costs. Sales were also impacted by various regulatory changes in the industry such as BS-VI, FAME-II as well as alternate mobility. The lack of clarity on the policy front could lead to uncertainty in the demand pattern in 2019-20,” said a report by India Ratings on April sales volume. Little room for a cut The central government led by Narendra Modi, has to walk a tightrope this Budget. The country is on the verge of a slowdown as GDP growth is all set to be lower than the expected 7%. At the same time, their ability to provide sops is also low as tax collections have come in slowed down. The government tax receipts this year <a href="https://www.businessinsider.in/there-is-a-lot-of-bad-news-that-modi-has-to-budget-for-this-year/articleshow/69635372.cms">are 5% lower </a>than what they were last year, throwing government into cost savings mode. SEE ALSO: <a href="https://www.businessinsider.in/there-is-a-lot-of-bad-news-that-modi-has-to-budget-for-this-year/articleshow/69635372.cms" data-type="tilCustomLink">There is a lot of bad news that Modi Government has to budget for, this year</a>

With 32 million jobs at stake in India’s auto sector, the Modi government may ease tax burden on cars

New Delhi, Dec 23 () Union minister Arjun Ram Meghwal on Monday said his ministry has received 3-4 demands, including suggestion to cut GST rates, from automobile industry body SIAM and has forwarded them to the finance minister.
Addressing the 4th annual SIAM CSR Conclave here, the minister of state for heavy industries and public enterprises asked the auto industry for more suggestions, if any, before the finalisation of the Budget. 
 "I have received 3-4 demands from the SIAM. I have sent your suggestions, including the one related to reduction in GST rate, to the finance minister. If you (industry) have any other suggestions please submit those as the Budget consultation process is still going on," Meghwal said here.
 He said it was important to submit suggestions before the consultation process gets over.
 "After the 'halwa ceremony', nothing can be added. So please give suggestions, if any, before that," Meghwal said adding that the finance ministry will not accept any suggestion after the halwa ceremony, which marks the launch of formal printing of Budget documents, is over.
Meghwal also emphasised on the need for corporates to wholeheartedly support social initiatives under their CSR activities.
The Society of Indian Automobile Manufacturers (SIAM) is a not for profit apex national body representing all major vehicle and vehicular engine manufacturers in India. MSS ANU
ANU

Have sent auto sector's Budget wish list to finance minister: Meghwal

With the arrival of new stable government, <keyword id="6355261" type="POSITION" weightage="60" keywordseo="Finance-minister">Finance Minister</keyword> <keyword id="42575" type="PERSON" weightage="60" keywordseo="Arun-Jaitley">Arun Jaitley</keyword> is all set to present the <keyword id="6360189" type="COMPANY" weightage="80" keywordseo="Union-Budget">Union Budget</keyword> 2015-16. Since it is the <keyword id="6360789" type="ORGANIZATION" weightage="80" keywordseo="Modi-Government">Modi government</keyword>’s first full-term budget and they already have promised a transformational budget, expectations are high on decisions to be taken for any sector of the country and automotive sector is no different. Here is AutoPortal’s take on the automobile industry and the budget impact on it. 
 
With the increasing growth in demand on back of rising income, expanding middle class and young population base, in addition to a large pool of skilled manpower and growing technology, will propel India to be among the world's top five auto-producers by 2015. 
 A report published by Delloite says, “India is expected to become a major automobile manufacturing hub and the third largest market for automobiles by 2020”. The automotive industry in India accounts for around 22% of the country's manufacturing gross domestic product (<keyword id="35050" type="CITY" weightage="60" keywordseo="gdp">GDP</keyword>) and is one of the largest employment creators of the <keyword id="34412" type="ORGANIZATION" weightage="60" keywordseo="economy">economy</keyword>. 
 
However, sales of passenger vehicles in the domestic market grew just 3.67% in the April-December period (mainly after the excise cuts) this fiscal in comparison with the same period a year ago and the industry went through slowdown for most of last year. 
 The situation got worsen in January 2015, after the withdrawal of <keyword id="6356916" type="UNKNOWN" weightage="60" keywordseo="excise-duty">excise duty</keyword> concessions, car sales in India witnessed major decline with main players <keyword id="44883" type="CITY" weightage="80" keywordseo="Maruti-Suzuki">Maruti Suzuki</keyword> and <keyword id="596" type="CITY" weightage="80" keywordseo="Hyundai">Hyundai</keyword> posting single digit growth in January, while others like <keyword id="121834" type="COMPANY" weightage="80" keywordseo="GM-India">GM India</keyword> and Ford saw decline in sales. 
AutoPortal’s outlook on the upcoming budget over automobile industry is: 
 
· Reduction in excise duty: In February 2014 interim budget, excise duty on small cars, scooters, motorcycles and commercial vehicles was reduced to 8% from 12% previously. For SUVs, it was cut to 24% from 30%; for mid-sized cars, to 20% from 24%, and to 24% for large cars from 27% earlier, in the hope of boosting the sector. In June2014, the new government led by Prime Minister <keyword id="6354477" type="PERSON" weightage="80" keywordseo="Narendra-Modi">Narendra Modi</keyword> extended the excise duty concessions till December 2014. As a result, auto manufacturers were forced to increase prices. The auto industry SIAM, further wants to extend the relaxation in duties as this would keep the cost of ownership down for the ultimate owners and increase the interest for new buys. Further, long-term stability in excise duty structure is needed across the country, so that manufacturers can plan their products strategy for the next 3-5 years. 
 
· Inverted duty structure: The government is expected to address the inverted duty structure in the forthcoming Budget. Under the inverted duty structure, taxation of inputs is at higher rates than finished products that results in build-up of credits and cascading costs, thus favouring imports of raw material. Under the government’s “Make in India” approach, it is suggested to remove inverted duty structure to protect the interests of domestic industry. 
 
· Implementation of <keyword id="6354679" type="ORGANIZATION" weightage="60" keywordseo="GST">GST</keyword>: Implementation and speedy action on GST will bring in growth to the economy and create a uniform tax structure across all states. Also this will persuade more exports through increased competitiveness in the international market. The auto industry is keenly looking forward to the roadmap and introduction of GST. 
 
· Scrappage Subsidy Schemes: Introduction of Scrappage Subsidy Schemes on lines of European counterparts, which will clean old cars off the road. Budget should include Policy for scrapping old cars- 15 years and above, along with the infrastructure needed to scrap. This will benefit the environment, reduce fuel consumption and also propel further demands for automotives. 
 
· Green initiatives to manufacturing of electric and hybrid cars: With the upcoming budget, Green initiatives from the government to boost sale of electric and hybrid vehicles is expected and also needed as ‘Go Green’ is the motto for all leading economies of the world. The government is expected to announce special tax incentives to promote eco-friendly vehicles and provide more sops for hybrid/ alternative fuel for vehicles, to increase the marketability and usage of these vehicles and to improve environment and economy by bringing down fuel imports. Continuation of the tax incentives from the Budget for 2014-15 like investment allowance and duty cuts for hybrid vehicles/ parts is also expected. 
 
Electric cars are an eco-friendly variant of four-wheelers. But these cars need to be charged regularly which requires a particular infrastructure (charging locations) across the country. The auto sector needs the government to help setup the charging infrastructure across cities. 
 
· Custom duty unchanged for exported cars: Fully imported cars attract a customs duty in excess of 125%. To promote “Make in India” and to provide healthy competitive platform to domestic players, the auto industry hopes that the budget will retain the customs duty at the current rate which ultimately increases the cost of imported cars. 
 
· Lowering of interest rates for financing vehicles: According to a Business World report, “Over 80% of the vehicles purchased in India are purchased with financing from banks and other institutes”. Thus, a reduction in bank <keyword id="37018" type="UNKNOWN" weightage="80" keywordseo="interest-rate">interest rate</keyword> on loans will overall reduce the cost for the consumer, ultimately improving the demand for the automobiles. 
 
Before it is too late and the auto industry is back to the days of poor demand and high taxes, it needs a big push from the upcoming Budget to be back on a growth trajectory. In the wake of the government's 'Make in India' and big expectations from the upcoming budget, Indian auto industry shall witness an unprecedented sales and demand growth. 
 
About the author: This article has been authored by Sagar Das, head-<a href="http://autoportal.com/">Autoportal.com</a>, ex-India dot com Product Management &amp; business of OnCars. 
 
Image source: Autoportal

Budget 2015: Auto sector demands tax sops

The auto industry witnessed biggest drop in 16 years in December as the sales fell by 18.66% in the month to 1.2 million units. 
 
This major fall is attributed to <a href="http://www.businessinsider.in/searchresult.cms?query=demonetisation&amp;sortorder=effectivedate">demonetisation</a>, which shook the industry. Now, the auto industry has high hopes from <a href="http://www.businessinsider.in/searchresult.cms?query=budget+2017&amp;sortorder=effectivedate">Budget 2017</a> that it will bring some reprieve for the automakers. 
 
"Budget is something which we all are hoping that the government will bring measures to boost consumer sentiment," <a href="http://www.businessinsider.in/searchresult.cms?query=SIAM&amp;sortorder=effectivedate">Society of Indian Automobile Manufacturers</a> (SIAM) Director General Vishnu Mathur said. 
 
READ ALSO: <a href="http://www.businessinsider.in/indias-auto-sector-witnesses-biggest-drop-in-16-years-thanks-to-demonetisation/articleshow/56470498.cms">India’s auto sector witnesses biggest drop in 16 years, thanks to demonetisation</a> 
 
The auto industry hopes <a href="http://www.businessinsider.in/searchresult.cms?query=arun+jaitley&amp;sortorder=effectivedate">Finance Minister Arun Jaitley</a> to announce a slew of initiatives such as concrete policy on fleet modernisation, specially of commercial vehicles and passenger vehicles. 
 
"We have also pointed out that the incentive scheme for electric mobility under the FAME scheme must be extended as most of the automobile companies have been working towards this direction," Mathur said. 
 
In order to promote eco-friendly vehicles, the government had formally launched the FAME India scheme in 2015 offering incentives on electric and hybrid vehicles of up to Rs 29,000 for bikes and Rs 1.38 lakh for cars. It envisaged Rs 795 crore support for the first two fiscals. Faster Adoption and <keyword id="3496050" type="UNKNOWN" weightage="20" keywordseo="manufacturing-of-hybrid-and-electric">Manufacturing of Hybrid and Electric</keyword> vehicles in India (FAME India) is part of the National Electric Mobility Mission Plan. 
 
On the taxation side, Mathur said it is unlikely that the <a href="http://www.businessinsider.in/searchresult.cms?query=GST&amp;sortorder=effectivedate">GST </a>will be implemented from April 1. 
 
"However, we have been seeking moderation of taxation for the automobile industry and reduction of slabs from the current four, ranging from 12-30 per cent, to two slabs," he said. 
 
SIAM had proposed a base rate for small cars and two- wheelers and another 8 per cent addition to that for larger cars, he added.

Hit hard by demonetisation, auto industry hopes for incentive schemes, moderate taxes in Budget 2017

New Delhi, Jan 27 () Auto component industry body ACMA on Monday sought uniform 18 per cent GST in the upcoming Budget.
Currently, about 60 per cent of auto components are at taxed at 18 per cent, while the remaining high value parts attract a duty of 28 per cent.
The auto component segment, which currently employs 50 lakh people and contributes 2.3 per cent to India's gross domestic product (GDP), also urged the government to come up with a fund to support R&amp;D and indigenous technology development.
"The automotive industry in India is undergoing a significant transformation due to new regulations and policy changes. On top of it, the economic slowdown has deterred domestic consumption, we hope that the forthcoming budget will help uplift both the consumer and industry sentiments," Automotive Component Manufacturers Association of India (ACMA) President Deepak Jain said in a statement.
To meet the government's vision of a USD 5 trillion economy by 2025, of which the manufacturing industry would be USD 1 trillion, it is critical that steps be taken to get the automotive industry back on track, he added.
"We are hopeful that the Government would consider our long-standing recommendation of 18 per cent GST on all auto components as also extend impetus to R&amp;D and indigenous technology development," Jain said.
The industry body also sought import duty exemption on auto component prototypes to encourage domestic R&amp;D and testing.
"Also retaining of weighted tax deduction on R&amp;D expenditure is critical. The 2016-17 Budget reduced weighted deduction benefit from 200 per cent to 150 per cent and has further restricted the deduction to 100 per cent from April 1, 2020," Jain said.
ACMA also urged the government to reintroduce investment allowance at 15 per cent for manufacturing companies that invest more than Rs 25 crore in plant and machinery. MSS
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ACMA seeks uniform 18 pc GST, fund to support R&D

<ul><li>M&amp;M, Ashok Leyland and Tata Motors have recovered from their intraday low.</li><li>Gadkari while speaking at a SIAM conference had said that the rising level of pollution is a health hazard for citizens.</li><li>There is no such proposal currently under active consideration by the government, said Gadkari in is clarification</li></ul> The auto index, <keyword id="3540651" type="General" weightage="20" keywordseo="Nifty-Auto" source="Orion">Nifty Auto</keyword>, recovered from its 400 point or approximately 2.5% fall after Union Minister <keyword id="26680" type="General" weightage="50" keywordseo="nitin-gadkari" source="Orion">Nitin Gadkari</keyword> clarified on Tuesday clarified his '10% additional <keyword id="18747014" type="General" weightage="60" keywordseo="GST-on-diesel-vehicles" source="Orion">GST on diesel vehicles</keyword>' comment made earlier in the morning. At the time of updating the story, the index is 1.6% in the red. Auto stocks had fallen sharply after Gadkari said he will seek a "<keyword id="2169429" type="General" weightage="60" keywordseo="pollution-tax" source="Orion">pollution tax</keyword>" in the form of additional <keyword id="6354679" type="General" weightage="80" keywordseo="gst" source="Orion">GST</keyword> of 10% on diesel vehicles and gensets in order to cut down on air pollution. This in turn has dragged the stocks down as most of the commercial vehicles in the country currently run on diesel. At the time of updating, Mahindra and Mahindra is down 1.7% but shown a recovery from the 3.48% slide. Ashok Leyland has now recovered slightly too and is down 2.4% while Tata Motors which had slipped 2.8% is now down 1.8%. The Road and Transport Minister has subsequently clarified his comment on X (formerly Twitter). He said that that there is no such proposal currently under active consideration by the government. <div type="twitter" handle="nitin_gadkari" handlename="nitin_gadkari" favoritecount="0" retweetcount="0" id="1701501884324860043"></div> Earlier, speaking at the 63rd Annual SIAM convention Delhi, the Union Road Transport and Highways Minister said the rising level of pollution is a health hazard for citizens. "I am going to handover a letter to the Finance Minister this evening stating that an additional 10% GST be put on diesel-powered vehicles," Gadkari said. In the passenger vehicle segment, various carmakers including Maruti Suzuki India and Honda have already stopped manufacturing diesel cars. Gadkari said the contribution of diesel cars has already come down drastically in the country and the manufacturers need to stop selling them in the market. Terming diesel as a hazardous fuel, he noted that the country has to import the fuel to meet the demand. "Say goodbye to diesel... Please stop making them, otherwise we will just increase the tax so much that it would become difficult to sell diesel cars" Gadkari said. He said he will propose additional GST on diesel-powered generators as well. Automobiles are currently taxed at 28% GST, with additional cess ranging from 1% to 22% depending on the type of vehicle. SUVs attract the highest GST at the rate of 28% along with a compensation cess at 22%. Gadkari also asked the industry to focus on environment-friendly alternative fuels like ethanol. He also asked the industry to focus on green hydrogen. Explained: <a href="https://www.businessinsider.in/policy/economy/news/what-is-ethanol-blending-current-targets-and-challenges-for-india/articleshow/103460113.cms" data-type="tilCustomLink" target="_blank">What is ethanol blending and what are the challenges faced by India</a>

Auto stocks recover after Gadkari clarifies his '10% additional GST on diesel vehicles' comment

New Delhi, Feb 1 () Automobile industry on Saturday said the Budget lacked immediate measures to revive the industry which has been going through a prolonged slowdown.
The industry however lauded the government's initiative to increase customs duty on imported electric vehicles and said it would help in establishing local production of such products in the country.
"The Indian automobile industry was looking forward to some direct benefits in the budget, which could have helped in reviving demand in the context of the current slowdown and huge investments made by the industry for transition to BS-VI and from that aspect, the Budget speech was not what we were expecting," SIAM President Rajan Wadhera said in a statement.
SIAM had made specific recommendations on steps that could have revived demand, like an incentive-based vehicle scrappage scheme; budget allocation for diesel buses procurement by STUs and zero customs duty for lithium ion batteries, which do not seem to have been considered, he added.
Automobile dealers' body FADA said the Budget lacked immediate demand boosters for the automobile industry.
"It was disappointing that as part of auto ecosystem, no direct benefits for the automobile industry were announced. Budget allocation for an attractive incentive-based scrappage policy would have been a demand booster for commercial vehicles," FADA President Ashish Harsharaj Kale said.
Even though GST is not a part of the Budget, an indication about rationalisation of rates for automobiles would have brought much respite for the industry, he added.
Auto component body ACMA, however, expressed satisfaction on the measures announced in the Budget especially for the focus on development of rural economy, manufacturing and infrastructure.
"We are glad that the government has announced a Rs 1,000 crore handholding scheme for mid-sized companies including those in the auto components to give a thrust to export development, R&amp;D and technology upgradation," ACMA President Deepak Jain said.
Supporting hike in customs duty on imported electric vehicles, Tata Motors President Electric Mobility Business Shailesh Chandra said 'Make in India' has been the priority of the government for greater value addition and employment generation in the country.
"The proposed hike in SKD/ CKD forms of passenger EVs is consistent to the 'Make in India' approach and encourages progressive localisation of electric vehicles in the country," he said.
This will drive the efforts of OEMs more towards local operations and ensure greater commitment to electrification in the country, Chandra added.
Echoing similar sentiments, Wadhera said the increase in customs duty for CKDs and SKDs of electric vehicles and CBUs of commercial vehicles were positive steps for Make in India initiative.
Mahindra &amp; Mahindra Managing Director Pawan Goenka said the structural changes in the way things are being done may not be enough to have an impact tomorrow, but will definitely give strong impetus to the economy in the long run. 
Simillarly, Nissan Motor India Managing Director Rakesh Srivastava said capital infusion in PSU banks and tax reforms will encourage more liquidity in the marketplace. 
"The Budget's push on boosting infrastructure and aiding the rural economy will help to counter the auto slow down," he said on Twitter.
EY Tax Leader, Automotive Practice Pramod Achuthan termed the Budget a mixed bag for the automobile sector.
"Higher allocation for infrastructure are positives for the industry...the scheme to boost electronic manufacturing along with higher customs duty on imports of electrical vehicles and parts should incentivise domestic electric vehicle industry. Lack of directional guidance on GST rate cut or cess reduction disappointing," he noted.
 Finance Minister Nirmala Sitharaman on Saturday announced an increase in customs duty on various kinds of electric vehicles. MSS ANU
ANU

Budget lacks immediate measures to revive ailing sector: Auto industry

It is going to be a bed of thorns when <a href="http://www.businessinsider.in/searchresult.cms?query=arun+jaitley&amp;sortorder=effectivedate">Finance Minister Arun Jaitley</a> will present <keyword id="6599769" type="UNKNOWN" weightage="20" keywordseo="Budget-2017">Budget 2017</keyword> in the parliament on February 1. This Budget is going to be one of the toughest for <a href="http://www.businessinsider.in/searchresult.cms?query=prime+minister+narendra+modi&amp;sortorder=effectivedate">Prime Minister Narendra </a><a href="http://www.businessinsider.in/searchresult.cms?query=prime+minister+narendra+modi&amp;sortorder=effectivedate">Modi</a>-led Indian government as the country is facing uncertain times. 
 
Events such as <a href="http://www.businessinsider.in/searchresult.cms?query=demonetisation&amp;sortorder=effectivedate">demonetisation</a>, slowing economy, etc will bear an impact on <a href="http://www.businessinsider.in/searchresult.cms?query=budget+2017&amp;sortorder=effectivedate">Budget 2017</a>. In the previous budgets, finance ministers had total insights into corporate balance sheets, economic performance, etc but since the budget has been shifted to Feb 1, this may prove to be a bane for Jaitley. 
 
"This (2017-18) budget would be presented in most uncertain times and is unpredictable,” NR Bhanumurthy, professor at National Institute of Public Finance and Policy (NIPFP), told ET. 
 
Jaitley will possibly have dearth of data. These are the looming factors 
 
<keyword id="3315394" type="UNKNOWN" weightage="20" keywordseo="demonetisation">Demonetisation</keyword> 
The RBI has failed to give any reliable data on the real impact of demonetisation. The note ban decision impacted several sectors heavily such as auto industry, which saw drop by 19% in December, worst in 16 years. 
 
“The last quarter of fiscal 2017 will be weak,'' Ajit Dange, head of portfolio management services, domestic business, at SBI Mutual Fund, told ET. 
 
<a href="http://www.businessinsider.in/searchresult.cms?query=tax&amp;sortorder=effectivedate">Tax</a> 
The year 2016-17 will see economic growth falling way short of estimates. However, the Indian government revenues will overshoot targets thanks to a relentless pursuit of evaders and amnesty schemes. 
 
The crackdown on suspicious accounts and illegal income hoarders will carry on. Even GST is expected to being some respite. 
 
SBI Mutul Fund's Dange told ET job losses as the shift to GST will shut down a number of small industries in the informal sector that employs over 90% of India's workforce. 
 
"Many of them (small industries) will be unable to evade taxes and will become uncompetitive. Tax evasion was the only source of profitability for many of them,” he told ET. 
 
Oil 
Oil is moving up steadily. The <a href="http://www.businessinsider.in/searchresult.cms?query=crude+oil&amp;sortorder=effectivedate">Indian crude oil </a>basket has risen from $39.88 in April 2016 to $54.24 in the first week of January, according to the oil ministry's petroleum planning and analysis cell. 
 
"We expect international oil prices to rise to near $60 in 2017 and about $65 in 2018,” an energy analyst with a foreign broking firm told ET on condition of anonymity. 
 
India imports more than 70% of its oil, and high international prices are the single biggest factor after monsoon rains that impact the economy. The volatile nature of both rains and oil prices are enough to give sleepless nights to finance ministers and can spoil the most meticulously planned budgets.

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