Union Budget 2023 will have positive impact on auto sector: SIAM

The Society of Indian Automobile Manufacturers (SIAM) on Wednesday hailed the Union Budget 2023 as growth oriented which will have a positive impact on the auto sector.

Vinod Aggarwal, President, SIAM and MD & CEO, VECV, said, "33% increase in capital outlay with an effective provision of Rs 13.7 lakh crores will spur growth in the economy resulting in positive impact on the auto sector.

“The Auto industry is fully aligned with the initiatives on Sustainability and de-carbonisation and increased focus on Hydrogen, Ethanol Blending, Bio Gas, Electric Vehicles and Battery Storage,” he stated.

The Union Budget laid down many provisions which were appreciated by auto industry bigwigs. One of the most significant announcements was the customs duty removal on capital goods imported for the manufacturing of lithium-ion batteries, which would eventually help reduce the cost of electric vehicles in the country.

However, this will apply to electric vehicles that will be manufactured locally in India. Sitharaman said in her budget speech that indirect tax proposals would boost green mobility and the electric vehicle sector in the country.

"Customs duty exemption extended to import of capital goods and machinery required for the manufacture of lithium-ion cells for batteries used in electric vehicles,” she said. She also proposed continuing the concessional duty on lithium-ion battery cells for another year.

Automobile dealers' body FADA President, Manish Raj Singhania said the capital outlay of Rs 10 lakh crore in infrastructure spending will aid CV sales. Apart from this, the reduction in individual tax slabs will benefit the ailing entry-level two-wheeler and passenger vehicle segment.