Auto Industry Awaits 2025 Budget for Growth and Innovation

As India gears up for the Union Budget 2025, the automotive sector is on the edge of its seat, anticipating pivotal measures that could accelerate growth, foster innovation, and enhance sustainability. With a significant push towards electric vehicles (EVs) and a shift towards greener technologies, the industry is hopeful for incentives that support this transition, bolster local manufacturing, and tackle challenges such as high input costs and supply chain disruptions.

Voices from the Industry

"We appreciate the government's holistic approach towards economic development, particularly their commitment to building an ecosystem that balances growth with sustainability," said Mr. Venkatram Mamillapalle, Country CEO and MD of Renault India. He expressed optimism about the government's vision for a robust supply-chain ecosystem and innovation hub, emphasizing the need for skill development, encouragement of ER&D, and enhancing the ease of doing business.

Mr. Vikram Gulati, Country Head and Executive Vice President - Corporate Affairs and Governance at Toyota Kirloskar Motor, highlighted the government's commitment to modernizing infrastructure and the positive impact of Production Linked Incentive (PLI) Schemes. He called for sustained focus on infrastructure spending and enhancing the scope of PLIs, along with measures to encourage the scrappage of old vehicles and support for greener technologies and alternative fuels.

Looking Ahead

The Indian tyre market, projected to reach USD 21.27 billion by FY2030, is also looking for increased funding for natural rubber plantations and rationalized GST rates on essential tyre manufacturing components. Samir Gupta, Managing Director of Continental Tires India, emphasized the importance of these measures for ensuring a steady supply of raw materials and reducing reliance on imports.

Mr. S Sunil Kumar, Country President of Henkel Adhesive Technologies India, spoke about the transformative crossroads at which the automotive sector stands, with the global shift towards electrification and sustainability. He called for incentives for R&D and the domestic production of high-performance adhesives and NVH solutions, which are key to enhancing EV performance and improving energy efficiency and safety.