scorecardresearch
Budget 2022: From promoting financing to GST cut, here's what EV players expect

Budget 2022: From promoting financing to GST cut, here's what EV players expect

Co-founder of OTO Capital for EVs Sumit Chhazed believes that the EV sector is likely to receive quite a couple of SOPs in the forthcoming Budget.

Simple Energy MD and CEO Suhas Rajkumar believes that the government should encourage the collaboration of players and divert more funds towards its clean fuel vision Simple Energy MD and CEO Suhas Rajkumar believes that the government should encourage the collaboration of players and divert more funds towards its clean fuel vision

India’s up-and-coming electric vehicle industry has quite the checklist for the forthcoming Union Budget 2022-23 as the automotive industry accounts for nearly half of India’s manufacturing GDP and nearly 8 per cent of the overall GDP. Co-founder of OTO Capital Sumit Chhazed for EVs believes that the EV sector is likely to receive quite a couple of SOPs in the forthcoming Budget.
 
Chazzed listed down the following SOPs that the government could grant in the Union Budget 2022-23.
 
EV sector’s wishlist vis-à-vis financing and tax duties

  • To promote EV financing for NBFCs and banks to a priority sector so that the general public can afford to purchase EVs at a lower rate of interest
  • Consumers should continue to receive incentives in the form of a tax deduction on loans
  • 28 per cent GST on auto components to be revoked as this could benefit manufacturers
  • Companies working to set up charging stations to receive incentives
  • Pool of financial support should be granted to startups that continuously invest in their R&D to reduce dependency on imports and make India Atmanirbhar
  • Curtailing the inverted tax duty, the original equipment manufacturers (OEMs) are bound to spend more on purchase of inputs and receive lower GST on selling the vehicles. This could lead to a possibility of blocking working capital and could, in turn, hamper the sector’s growth.

Chazzed further explained, “The upcoming Budget should have a beneficial impact as EV financing, which is likely to be placed under the priority sector for prompt adoption. This would subsequently create a robust ecosystem for electric vehicles. Therefore more and more citizens can afford EV at lower interest rates and avail fringe benefits in the form of tax deduction on loans, an incentive implemented by the government the preceding year.”
 
Simple Energy MD and CEO Suhas Rajkumar believes that the government should encourage the collaboration of players and divert more funds towards its clean fuel vision. He added that the government is trying to support the sector through FAME subsidy and other schemes to help the industry produce better products at affordable prices.
 
“The budget should encourage the collaboration of EV players and divert more funds towards the government’s clean fuel vision. To facilitate the mass adoption of electric vehicles in India, we need a seamless EV infrastructrure that is much more capable and connected, sustainable and has a more intelligent mobility landscape,” Rajkumar noted.
 
Besides this, industry players have demanded that the central government should make it mandatory for every state in India to have its own dedicated electric vehicle policy under the Go Electric initiative. They also want the government to introduce and invest in awareness programmes around electric vehicles in order to ensure larger consumer adoption of EVs.
 
According to Okinawa Autotech’s Jeetender Sharma, the Centre should introduce standardised EV charging infrastructure across the country to ensure better availability and wider acceptance, thus, leading to mass penetration of EVs into the Indian market. He also noted that large amounts of investment, R&D and investments have started to flow with the shift to e-mobility.
 
Sharma also expects that the Centre will make the use of EVs, especially for last-mile deliveries, mandatory. He added, “The electrification of the last mile is of extreme significance in the mass penetration of EVs in India. It will help businesses save costs and at the same time, contribute to the environment.”
 
LML Electric CEO and MD Yogesh Bhatia expects the government to support battery cell manufacturing in the upcoming Budget 2022-23 in order to reduce import dependency amid the ongoing semiconductor shortage globally. Bhatia further noted that we should focus on building robust manufacturing infrastructure for essential components inside India as well.
 
“In this upcoming budget also, we foresee the government to support battery cell manufacturing which can further reduce the import dependency. Moreover, due to the pandemic and other geopolitical conflicts, the world is already going through turbulent times especially when it comes to global manufacturing of components such as the shortage of semiconductor chips and other related parts. Thus, we believe, the need of the hour for our country is to gear up and build ahead of a significant infrastructure in order to reduce further dependency for essential components on other countries,” says Managing Director and CEO of LML Electric Yogesh Bhatia.

Also read: Budget 2022: Here's what India's crypto industry looks forward to

Also read: Budget 2022: More funding, setting up NRF; here’s what R&D industry expects

Also read: Budget 2022: Fiscal consolidation shouldn’t be only focus, say SBI economists