Home News SIAM welcomes the Union Budget for the year 2013-14

SIAM welcomes the Union Budget for the year 2013-14

SIAM welcomes the Union Budget for the year 2013-14

SIAM has welcomed the Union Budget for the year 2013-14 tabled by finance minister of India, P Chidambaram. This was announced by S Sandilya, President, SIAM. In his statement, Mr Sandilya mentioned that under the current economic environment, the finance minister has tried to balance the need for growth with fiscal compulsions.

The announcement of investment allowance reintroduction is very positive. Focus on infrastructure is also a welcome move, which will help growth of the economy. Mr Sandilya added, “While there are several innovative proposals, the auto industry had expected that the Finance Minister would come out with more specific roadmap for implementation of Goods & Services Tax (GST). The industry would be keenly looking forward to full implementation of GST at the earliest”. Appreciating Mr Chidambaram’s move to double the funds under JNNURM scheme enabling substantial part for purchase of upto 10 thousand buses, Mr Sandilya also praised the finance minister’s decision to lower excise duty on commercial vehicle chassis from 14% to 13%. The excise duty was raised in the last budget, and led to significant drop in off-take of chassis by the body builders. With a view to deteriorating market sentiments, SIAM had also recommended reduction of excise duty for passenger cars by 2%, which could have led to significant improvement in sales.

The finance minister instead, it seems, accepted SIAM’s recommendation on extension of concession for import of electric and hybrid electric vehicle parts till 31st March 2015. While the increase in customs duty for luxury cars and motorbikes seems to be an effort to raise more revenue, and to encourage local manufacturing, value addition and employment, the proposal to increase duty on second hand vehicle from 100% to 125% is the right step, averred Mr Sandilya. “It clearly conveys that India is not ready to accept second hand old vehicles from other countries”, he further said. If Mr Sandilya was a little disappointed, it were the increase in excise duty on SUVs used as personal vehicles. “This is the only segment in the industry which has been doing well this year and increasing price of these vehicles would dampen sales and impact market sentiments further”, he expressed.

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