Several auto industry leaders
blasted the Indian government for intermittent regulatory uncertainties and
urged the government to come out with clear and firm policy guidelines.
Dr Abhay Firodia who is the chairman of Force Motors Limited minced
no words when he told the government that the industry had faced disruptions in
the past and the time had now come for “clear, firm policy guidelines” for the
Indian auto industry.
He was speaking at the 57th
Annual Convention of the Society of Indian Automobile Manufacturers (SIAM) in
New Delhi. He pointed out that “...We had disruptions due to demonetisation
last year. We have the GST now. We had transition to BS IV emission norms in an
unplanned manner owing to which we suffered losses. We need a clear, firm
policy guidelines concerning fuel, new technologies and clean transport. This
would ensure that the industry doesn’t suffer jerks and losses.”
Dr Firodia further pointed out
that there is lot of confusion on many aspects relating to GST. “We need to
have a comprehensive automobile policy and we need a favourable policy
environment. Safety on roads is a concern for all of us, as over 1.5 lakh
people died in the past year. We also urge for the need of more cooperation
from the Ministry of Road Transport & Highways for having a robust policy
Guenter Butschek, CEO & MD, Tata Motors during his address in
the session focusing on “Regulatory Policies: Analysis of Impact” said that if
the Indian auto industry had to realise its true potential by 2026, there is
need to eradicate the basic challenges deeply rooted within the overall
ecosystem: accentuated by intermittent regulatory uncertainties.
“While an array of policies
and reforms like the Automotive Mission Plan, Make in India and Smart Cities
have had a positive impact on the industry, regulatory uncertainties in the
face of Demonetization, BS III to BS IV transition and GST have caused
disruptions in the market. With our future Auto Mission Plan, if we have to
realise the true potential by 2026, we need to eradicate the basic challenges
deeply rooted within the overall ecosystem: accentuated by intermittent
regulatory uncertainties. With India lagging on emission and safety norms in
comparison to the rest of the world, it is important that all OEMs work towards
bridging this gap with a single-minded commitment to invest in future
technologies and leverage emerging trends, for a greener and sustainable
automotive future,” he said.
“The industry understands and fully appreciates
the regulatory and policy changes but what we seek today is a platform to
ensure a well-orchestrated, collaborative and participative approach from the
Government for a policy framework that enables and supports sustainable growth.
Today, we live in a world of complexity and hence focus, speed of execution and
quality of implementation across the ecosystem will be key to our success,” he
Meanwhile, Union Minister of
Road Transport & Highways Nitin
Jairam Gadkari called upon India’s automobile industry to gear up to face
the competition heating up in the international market.
Speaking at SIAM’s Annual Convention titled
“Building the Nation, Responsibly” Gadkari noted that the Indian automotive
industry has done well despite facing various regulatory hurdles and
“I am proud to say that the auto industry has
always been one among the leading players in our nation building, and that too
responsibly. When it comes to sustainable and environment friendly
transportation, the Indian auto industry took up the challenge and agreed to go
through the pain of leapfrogging towards better environment by accepting BS6
norms from 1st April 2020,” he observed.
However, at the same time, the
industry also needs to move towards Zero Emission regime with electric
vehicles, he added. Although the minister was bullish on the size and market of
Indian auto industry and directly linked it to India’s GDP growth, he pointed
out that as more vehicles are coming on road, the government will have to
increase lanes of roads and highways to meet the demand.
He also informed that the
demand of cars have increased in past three years. “This is something big that
the country cannot handle in the existing infrastructure alone. The industry
and the government must come up with a diversified solution. We need to bring
in qualitative reforms in the automobile sector and expand the scope of rural transportation
while bringing in newer technologies and encourage electric vehicles,” Gadkari
Srinivasan, Chairman, TVS Motor Company Limited was of the view that the
GST and demonetisation will make a transparent economy.
“The most important disruption is the electrification.
It is something certainly going to happen by 2030 or 2040, I cannot say. But at
least 30 per cent of the vehicle will be electric,” Srinivasan said.
Kenichi Ayukawa, Treasurer, SIAM and Managing Director & CEO,
Maruti Suzuki India Limited called India as a unique country where the auto
industry offers a large scale employment. He however pointed out that there are
some concerns like issues related to CO2 emissions, growing traffic and accidents.
He said some of the bottlenecks concerning
vehicles can be mitigated while working on appropriate designing of the
will do everything and help the industry by all means, says Anant G Geete
In another session during the
day, Union Minister of Heavy Industries and Public Enterprises, Anant G Geete
said India’s automobile industry has been a primary contributor to Prime
Minister Narendra Modi’s `Make in India’ initiative.
“We as the guardian of the automobile sector,
assure you that the government will do everything and help the industry by all
means. There are concerns raised over Goods and Services Tax, unified tax
regime implemented on July 1 and its impact on auto industry. I assure you that
it is the duty of the government to offer all help to the industry in this
regard,” Geete stated.
Amitabh Kant, CEO of NITI Aayog, government’s
main policy think-tank, pointed out that there has to be clarity, consistency
and continuity in the policy and that all policies for auto sector should be
technology agnostic and left to the market forces for its self-sustaining
growth. He said that over- dependence on a single technology may scuttle the
R& D spirit, innovations and out of the box thinking which may not be
helpful for automotive sector.
He pointed out that India’s
automobile industry must think of the size and scale that is required and must
follow innovation plans. “The conventional regulatory policies in the
automobile sector so far have been incremental and gradual. However, the recent
decisions like leapfrogging to BS-VI emission norms, 100 % electric vehicles by
2030, methanol economy and fuel efficiency norms are transformational and will
have fundamental impact on entire automotive ecosystem without any transitional
phase,” Kant observed. This is one of the most disruptive phases for the
automotive industry globally, he added.
“We should have India as hub
for EV growth,” he added. He also called upon the industry to formulate and
suggest overall policy for EV promotion. He said India should be the base for
zero defect and zero effect’ and with homegrown innovations, India should be
the base of manufacturing.
Earlier while welcoming the
delegates Vinod K Dasari, President SIAM and CEO & MD of Ashok Leyland urged
the government to create a National Automotive Board which considers the
concerns of all factions and then prepares a clear and ambitious, long term
roadmap for regulations that are in the best interest of the country. “We do
not need to simply copy the regulations from Europe,” he pointed out.
He also appealed to the
government to bring in legislation to reduce polluting vehicles and ban
vehicles which are more than 15 years old. “To reduce pollution we have
committed to Euro 6 levels in 2020 already. We request that you please bring in
legislation to reduce polluting vehicles and ban vehicles which are more than
15 years old,” Dasari explained.
He also announced that as a
voluntary measure, SIAM will initiate three more Voluntary Codes of Practice a
Full compliance to the Bus Body Code which is ready but yet to be implemented
by government, banning use of certain materials in the manufacturing processes
for vehicles and components that are now globally known to have hazardous
effects on the health of people; and making all Vehicle Recall data available
on the SIAM and the MoHI Websites for public consumption.
SMEV hails statement
of Amitabh Kant
Meanwhile, hailing the statement
of Amitabh Kant, CEO NITI Aayog, Sohinder Gill, Director- Corporate Affairs,
SMEV said, “SMEV is working closely with NITI Aayog and Government for
widespread EV adoption in India, this collaboration has resulted in creating
favourable policy environment. Short term measures and incentives for the
existing manufacturers are the need of the hour. We propose front loading of
the incentives for the initial six months or one year so that the sizeable mass
of EVs are seen on road. Long term incentives can follow the short term
“We have recommended to
various Government organizations for addressing the concerns of the Industry
like enhanced subsidies for EVs from NITI Aayog, extension of FAME from
Department of Heavy Industries, EV 2W priority in battery swapping module from
Ministry of New and Renewable Energy, Uniform GST rates for EVs and advanced
batteries from Ministry of Finance, replacing commercial two wheelers with EVs
- Ministry of Road Transport & `Highways, easy finance priority lending
from banks to EVs - State Govt./ Ministry
of Finance, etc.” Gill added.
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