The Union Budget presented by Finance Minister Nirmala Sitharaman today seeks to complement macro-economic level growth, focusing on microeconomic level all-inclusive welfare. There were several positives for infrastructure, manufacturing, and startups. The faster roll-out of EV charging infra and battery swapping is set to accelerate the adoption of clean mobility in the country.
Kamal Bali, President & MD, Volvo Group, India, described it as a progressive, thoughtful, imaginative, and growth-oriented budget that touches all socio-economic segments while embracing technology & modern tools of governance. 'The Budget has rightly allocated the highest ever Capex of $ 100 billion (INR 7.5 lakh crore), up 34% over the last year, aimed at creating & improving our logistics infrastructure through PM Gati Shakti NMP, as well as social sectors of health, education, women, housing and the needs of our 112 aspirational districts. This, while following the agreed pathway on the fiscal deficit (4.5% by FY 25-26).'
The focus on logistics will help solve supply-side challenges and curb structural inflationary challenges. Public transport, urban infrastructure push, and inter-operable battery swapping policy are big positives. In addition, the extension of the ECLGS credit guarantee to MSME and hospitality sectors is a welcome step. 'Finally, the digital rupee is in the right direction. Thankfully, no major negative surprises in this purposeful Budget,” he added.
Venkatram Mamillapalle, Country CEO & Managing Director, Renault India, said the government’s focus on Battery Swapping policy to be brought with inter-operability standards and push for cleantech and electric vehicles will create the right ambient environment for EV introduction and overall harmonisation of the electric mobility aspiration of the nation. In addition, the government's emphasis on developing the infrastructure within the country will further help build capacities for the resurgence of the automotive sector in India. Better roads will have a certain positive impact on the automotive industry. Besides, strengthening the rural economy through an MSP payment of INR 2.73 lakh crore and other benefits to aid the farming sector will help increase disposable income, improve the sentiment in rural areas, and further enhance the demand & aspirations of rural and semi-urban markets of India for personal mobility.
Diego Graffi, Chairman and MD, Piaggio Vehicles, said this is a good Budget for promoting green mobility. The PM Gati Shakti project is revolutionary that will take India’s logistics, infrastructure, sustainability, and green mobility initiatives forward. 'As this focuses on multi-modal logistic parks and Unified Logistics Interface Platforms, we believe that it will help in reconciling supply chain constraints and make them more robust. Considering the battery swapping policy one of the initiatives in the Budget for the auto industry, we feel the policy as being a sincere advocate of EVs as last mile mobility solutions. Larger battery swapping infrastructure will help enhance EV infrastructure and should propel the adoption of EVs.'
Suresh KV, President and Regional Head ZF India, said the allocation of INR 20,000 crore for infrastructure projects and 25,000 kms of additional National Highway network during FY23 is a welcome move. This will positively impact the transportation industry and the auto sector at large. The special focus towards clean technologies and electric vehicles for public transport will positively impact companies manufacturing and supplying technology to electric buses and commercial vehicles. The move to boost the rural economy with the announcement of an MSP payment of INR 2.73 lakh crore coupled with other benefits will aid the farming sector and is bound to enhance the rural economy and sentiments. The concessional corporate tax of 15 % for more than one year till March 2024 will provide the much-needed impetus for the COVID impacted manufacturing segment. This is further bolstered by the eagerly anticipated re-look at the SEZ act, which will boost the competitiveness of the Indian manufacturers, Suresh added.
Mohammad Athar, Partner and Leader - Industrial Development, PwC India, said the proposal to allocate an additional INR 19,500 crore for PLI to manufacture high-efficiency modules and prioritise the full integration of manufacturing units into solar PV modules will encourage the private sector, which has shown a strong interest to invest. It will also help India position itself as a manufacturing hub in the clean technology manufacturing space.
According to Ashim Sharma, Partner & Group Head Business Performance Improvement Consulting (Auto, Engg. & Logistics) at Nomura Research Institute, the battery swapping policy will certainly have a positive impact on electrification of vehicle segments such as City buses, Taxis, 3W as most of these operate in a more or less fixed territory and in cases of buses, one entity, i.e. the transport corporation can own the swapping stations locate within the depots which creates an end to end control viz. over the vehicle as well as the fuel, i.e., the battery which in turn aids in the demand management of batteries. In addition, 2W applications would also benefit on account of this. This would also need a cloud-powered interconnected network which would also boost connectivity solutions. Given the expected increases prices of battery raw material, steps must also be taken to ensure technology absorption can be brought about in cell level manufacturing.”
Parag Satpute, Managing Director Bridgestone India, viewed the Budget as forward-looking, as it focused on not only the economic health of the country but also took into account physical and mental health. The PM Gati Shakti plan and the corresponding announcement of an additional 25,000 km of roads will spur growth in the mobility sector. In addition, the government’s initiative on electric vehicles and the announcement on a battery swapping policy is a major boost to the nascent EV sector and will boost customer confidence in EVs.”
Rajeev Sharma, Chief Strategy Officer, Mitsubishi Electric India, said, 'This is a growth-oriented Budget, I am sure that stepping up the capital expenditure sharply by 35.4% will have an incremental effect on the overall growth of the economy. It is good that the policy makers understand that nearly half of our population is likely to be living in urban areas by 2047, when India is at 100. The announcement for urban capacity building like mass transit, planning help, etc. would act as a good principle for development of the country. The Budget has demonstrated a good balance between today’s needs and the future’s demand.'
Manish Bhatnagar, MD, SKF India, said, “The heightened expectations from the Budget 2022 have met with a matching delivery. The Budget is more capital incentive - focusing more on the supply side and growth-oriented, with no adverse tax rollout. We are excited to see announcements under the ‘Battery Swapping policy’, supporting the clean tech in urban mobility space. PM Gatishakti plan of expanding national highways by 25,000 will act as a catalyst in seamless mobility, employment generation, and efficient connectivity across the nation. We welcome FM’s announcement on cutting down of import duties on metals including steel and aluminum. The move will benefit the manufacturing sector to lower input cost and unburden the businesses from hiked steel prices.”
Farrokh Cooper, Chairman & Managing Director – Cooper Corporation, said the Union Budget has shown a progressive and futuristic approach for all sectors in India, which will help boost the Indian economy and recover from the pandemic. 'The government has taken some prudent initiatives for MSMEs in this Budget, and I believe that their approach to fast-tracking the economy by providing opportunities to startups and businesses and creating six million new jobs will not only boost the economy but will support our future generation with an advantage above all.'
Anurag Garg, Managing Director & Country Head, Vitesco Technologies, India, said the Budget has so many important announcements that will be helpful for the Indian automotive segment paving their way into the EV segment and manufacturing sector at large. The government has shown major attention to the overall digitalisation of various services and pushing clear air & sustainability as one of the most important highlights. 'We appreciate the heightened emphasis in respect to EV segment, the introduction of the new policy for battery swapping will encourage the use of electric vehicles. With additional increased focus on expanding EV infrastructure across the country, with more EV charging stations to help vehicle owners to shift to electric cars without the lesser worry of connectivity, these decisions were much needed at this period to boost usage of EV,' he added.
Aakash Minda, Executive Director, Minda Corporation, dubbed it as the 'booster dose budget' in some quarters, as some measures like Capex spent around INR 7.5 lakh crore, PM Gati Sakti projects and focus on making India more Atmanirbhar will undoubtedly offer a shot in the arm for the manufacturing industry. Furthermore, announcements such as the battery swapping policy and the push for cleantech and electric vehicles will further spur the growth of the EV industry while also acting as a catalyst for jobs among the youth.
Raj Manek, Managing Director, Messe Frankfurt Trade Fairs India, said, the focus on technology inclusion across multiple sectors was visible in the 2022 Budget, which signifies a consistent, growth-oriented vision to improve ease of doing business. Additionally, the thrust on national transportation infrastructure development through modernising railways, highway expansions and battery swapping policy for the EV sector can, in the long run, strengthen India’s position as a more investment-friendly destination and boost the Indian auto industry and the EV ecosystem.