Industry

Need government support to tide over crisis: SIAM

Maruti Suzuki India Managing Director and CEO, Kenichi Ayukawa. File photo   | Photo Credit: Kamal Narang

Seeking government support to tide over “one of the toughest times” in history, by way of GST reduction, introduction of a scrappage policy and a stable regulatory roadmap, the auto industry on Friday said it was not in a position to invest further towards implementing new, upcoming regulations.

Meanwhile, expressing hope that the auto sector might very soon get some ‘good news’, Heavy Industries Minister Prakash Javadekar added that he would take up the industry’s concerns with Finance Minister Nirmala Sitharaman as also with Prime Minister Narendra Modi.

Also read: July sales hint at auto sector revival

Pointing out that the industry had made significant investments towards the implementation of BS-VI emission norms and new safety regulations, Rajan Wadhera, the outgoing president of the Society of Indian Automobile Manufacturers said commensurate revenues had not been realised due to lack of consumer demand.

“We make a very strong plea and request to you that the industry is not in a position to invest in new regulations like CAFE and RDE which are likely to come in the next two years,” he appealed to Mr. Javdekar, while speaking at SIAM’s 60th annual convention.

Kenichi Ayukawa, MD and CEO of the country’s largest carmaker Maruti Suzuki India, reiterated long-pending demands, including GST reduction on automobiles and an incentive-based vehicle scrappage scheme. “We believe that taxes on the increasing turnover will be more than the government expenditure on the scrappage scheme and GST reduction,” Mr. Ayukawa, who will take over from Mr Wadhera as the president of the industry body, said.

Replying to queries at the session, Mr. Javadekar added that the proposal for the auto scrappage policy was ready and all stakeholders had provided inputs; therefore its announcement was likely “very soon”.

On the possibility of a GST rate cut, he said the details of proposals are being worked out by the Finance Ministry. “... in a logical sequence... two wheelers, three wheelers, public transport vehicles, then four wheelers... in that order, it should come,” the Minister said.

‘FTAs playing havoc’

Pawan Goenka, MD and CEO, M&M, speaking at a session attended by Commerce Minister Piyush Goyal, pointed out that unfavourable FTAs were impacting competitiveness of India’s automobiles and component exports.

“... unfavourable FTAs are playing havoc on our competitiveness... we request you [the Centre] to keep this high on the agenda as you negotiate trade agreements.”

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Printable version | Oct 22, 2020 6:11:58 PM | https://www.thehindu.com/business/Industry/maruti-suzuki-ceo-reiterates-demand-for-gst-rate-cut-on-automobiles/article32521367.ece

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