With road safety being the hottest competition topic in the debated world after the death of Cyrus Mistry, Union Minister for Road Transport and Highways Nitin Gadkari has asked automotive OEMs to be quality-focused and not cost-focused. At the 62nd Annual Session of the Society of Indian Automobile Manufacturers (SIAM), Gadkari addressed the attendees and said that automotive brands should focus on reducing the cost of manufacturing with the use of new age technologies. He further said that they should develop automotive solutions that provide comfort and also help brands cut down on import vehicles.
Nitin Gadkari said, “I tell my friends in the automobile sector that you should be quality-focused and not cost-focused. Because people’s preferences are changing.” Referring to the vehicle junk policy, Gadkari said the transport and steel ministries would once again request the finance ministry to consider reduction in the Goods and Services Tax (GST).
Gadkari said, “Yesterday, I had a meeting with Steel Minister Jyotiraditya Scindia. Both of us are going to meet the Finance Minister again and request him to give GST concession for new purchase of vehicles against cancellation of old vehicles. Huh.” Let there be a beneficial situation for all.
The minister also suggested that automakers may offer some discounts to people for buying new ones as against scrapping old vehicles. “I don’t want to make it mandatory… Is it possible for automobile manufacturers to give some exemption for purchase of trucks, for four wheelers, for buses against scrapping of old ones.” It (exemption) for trucks. 50,000 can be for Rs. And for buses, small vehicles it can be less, then it can be an incentive,” he said. The vehicle scrappage policy came into effect from April 1, 2022.
Announced in the Union Budget 2021-22, the policy provides for a fitness test after 20 years for private vehicles, while commercial vehicles will require it after completion of 15 years.
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Noting that high logistics cost is making Indian manufacturers uncompetitive, Gadkari said he is confident that the country’s logistics cost will come down from 10 per cent of GDP in the next two years to 14-16 per cent at present.
According to Gadkari, the logistics cost in China is 8-10 per cent, while in the case of the European Union it is 10-12 per cent.
The minister acknowledged that automobile companies are facing shortage of semiconductors.
Gadkari said space is available for setting up a bullet train project on the Delhi-Mumbai Expressway, which is likely to be completed by March 2023 and he would voluntarily consider such a proposal.
“I have 120 meters of width available on the Delhi-Mumbai Expressway. If anyone wants to invest in the bullet train project, I can offer him the land tomorrow morning and he can start the work,” he said.
The Delhi-Mumbai Expressway is being built as part of the first phase of the Bharatmala project. The 8-lane expressway will cover Delhi, Haryana, Rajasthan, Madhya Pradesh and Gujarat.
With inputs from PTI