New Delhi: The Union Budget 2023 will be presented in Parliament on Wednesday. The auto sector, which is back on track in the last year, also has high hopes from the budget this year. The eyes of the auto sector are fixed on some special things and demands are being made from the government for a long time regarding them. The government is also very serious about all these things and it is expected that big decisions can also be taken on these in the budget this year, which will give great relief to the auto sector. This will be a win-win deal for everyone from auto manufacturers to vehicle buyers.
The long-standing demand of the auto sector is fame subsidy on EVs, GST on auto parts, and alternative fuel. Their direct impact is going to fall on the end user. So let us tell you what are the demands of the auto sector and whether the government will take a decision on them or not….
The benefits of Fame go directly to the customers
The society of Manufacturers of Electric Vehicles (SMEV) demands that the benefit of FAME subsidy should be given directly to the customers and not diverted from the automobile industry. Along with this, there has also been a demand to extend the time limit of fame. According to SMEV, the market for electric vehicles has grown rapidly but it is still expected to grow further. In such a situation, the limit of fame subsidy should be increased. The government may accept the demand to increase the fame subsidy, the reason being that the government has been promoting electric vehicles since the beginning.
GST should be reduced on auto parts
On the other hand, the rate of GST on parts for EVs is 18 to 28 percent. This increases the manufacturing cost considerably. Also, during the after-sale service, the customer has to pay more tax on buying any part. Regarding this, SMEV demands that GST on auto parts should be made uniform and its rate should be reduced. Due to this the burden on the auto manufacturers, as well as the customers, will be reduced. However, the government had also shown seriousness about this matter and Union Minister Nitin Gadkari had also assured to do something soon in this regard. Now it is believed that the government can take a big step regarding this in the budget.
Alternate fuel
The government can also make a big announcement regarding alternate fuels like biogas or hydrogen-powered vehicles or flex fuel and subsidies or any kind of exemption can be given on these vehicles as well. The reason for this is that these vehicles cause less or no pollution and these cars will also bring a lot of relief to the government which is facing the problem of pollution. The auto sector has also been raising demands regarding alternate fuel cars for a long time.
Demand to increase ethanol production
Ethanol is currently being mixed with petrol. It is an organic compound and it not only increases the life of the car but also reduces pollution. At present, 1G ethanol is produced in the country but it needs to be increased. It is based on biomass and it can also be easily increased. Demand is being made to stop its production at the district level and the government can take a decision regarding this as well.
