No new investments in auto sector this year, says Supriyo

Trend follows judicial directives on diesel cars, Minister tells Rajya Sabha

BLOCKING INVESTMENT: The auto industry had termed the Supreme Court’s decision as “unfortunate,” hinting that the move may impact investments and employment in the automobile sector.

New investments in the automotive sector have “certainly stopped” in the last six months as investors seem sceptical of government policies in view of recent court and tribunal orders, the government informed the Parliament.

The Supreme Court in had imposed a ban in December last year, on the sale of new diesel cars of engine capacity 2000 cc and above in the national capital region. Also, in May this year, National Green Tribunal circuit bench had banned the sale of such cars in Kerala.

Sceptism rules

“Decisions on new investments in the entire automotive sector across the country have certainly stopped for the last six months as it seems (that) auto industry is sceptical on the sustenance of the existing policies of the government in light of the recent direction by Hon’ble Courts and Tribunals,” Minister of State for Heavy Industries and Public Enterprises Babul Supriyo said in a written reply to the Rajya Sabha. The minister added that the government has submitted an affidavit to the Supreme Court requesting it to modify the order imposing the ban. The Department of Heavy Industry, he said, has also submitted that BS IV emission norms are the most stringent emission norms in the country and banning a category of vehicle that meets these regulations “is unjustified.”

Further, the government has submitted a request before the National Green Tribunal to not apply any restrictions on sale and registration of new vehicles, which are complying with the statutory emission norms irrespective of fuel used, in any city. The auto industry had termed the Supreme Court’s decision as “unfortunate,” hinting that the move may impact investments and employment in the automobile sector.

Petrol variants

Meanwhile, some manufacturers such as Mercedes and Jaguar Land Rover announced the roll out of petrol variants for all their models.

In a recent interview with The Hindu , Mercedes-Benz India Managing Director and CEO Roland Folger said: “The plan now is to wait. The final verdict is yet to be out. We have brought forward our points before the Supreme Court and they have heard us and now we are waiting for them to make the decision… Then we will see how that will impact us.”

It was too soon to take a decision on holding back investments in the country, he had said.