By Prashanth Doreswamy,
The Union Budget of 2021-22 has a few vital benefits for the automotive and manufacturing industry. Several of the initiatives announced today, such as the commitment of Rs 1.97 lakh crore for PLI schemes and guidelines on scrappage policies will have long-term gains for the industry. Especially the scrappage policy will help in generating demand for new vehicles and
also further the cause in curbing vehicle emissions.
The relaxation in the customs duty on steel products, ferrous, and non-ferrous materials etc., is a welcome move, however, raise in the customs duty for certain auto parts will further inflate the overall cost of the vehicle.
While the focus on renewable energy sources, with the Hydrogen Energy Mission and allotment to development of Solar Power, looks futuristic. Electrification of vehicles is the future of the automotive industry.
To allow private players to finance, acquire, operate over 20,000 buses is a promising step. We await further clarification on the scrappage policy to evaluate the actual impact and benefits to the industry.
(The author is the Managing Director, Continental Automotive Components (India) Pvt Ltd.)