Today Union Finance Minister announced first ever Budget 2015. The budget speech is more inclined towards infrastructure, roads, transport and taxation. However, FM did not give importance to automobile industry on a whole but focused on clean energy by proposing Rs 75 cr for manufacturing electric vehicles.
Reacting on proposal of fund for electric vehicle manufacturing, Sohinder Gill, Director- Corporate Affairs, Society of Manufacturers of Electric Vehicles said "We welcome the announcement on interim NEMMP towards promoting Electric Vehicles and supporting charging infrastructure and Randamp;D investments.
Its like a life saver for the ailing companies who had invested into the environmentally friendly vehicles but were bleeding heavily because of the lack of government support. In addition to supporting the industry NEEMP will create a significant positive impact on the health index of country by promoting zero pollution electric vehicles and reducing the dependence on the fossil fuel".
Although We are awaiting details it is expected that around Rs.1000 cr will be allocated for a period of two years, a large part of which will go directly into the hands of the customers in term of reduction of the prices of electric vehicles by around 20% and in installing charging stations in many cities..
We believe the biggest beneficiary of the NEMMP will be companies manufacturing electric two wheelers and small electric cars, who have managed to survive through the difficult years and have been still active in the market. NEMMP is also likely to trigger the entry of many of the major automotive players to start launching electric and hybrid vehicles.
Now that the centre has cleared the roadmap for the growth of electric vehicles in India, SMEV expects states to join in to support this initiative. At present many states like UP, Punjab, Haryana, Maharashtra etc have been charging VAT as high as 14% or more, road tax of 4 to 6%, nullifying the NEMMP's incentives. SMEV requests such states to immediately revert to 0 VAT and eliminate road tax for few years.
He also added, "The government has an ambitious target of putting 5 million electric and hybrid vehicles per year on the road by 2020 and SMEV is confident that this figure can be achieved if NEMMP is continued for its committed period of 6 to 8 years, state government pitch in with their support and the manufacturers invest in technology and capacity building".
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