Patel pitches for stimulus package for auto sector
Worried over prolonged fall in auto sales, Minister of Heavy Industry Praful Patel today once again pitched for a stimulus package to revive the sector.
August 28, 2013 / 13:59 IST
Worried over prolonged fall in auto sales, Minister of Heavy Industry Praful Patel today once again pitched for a stimulus package to revive the sector. "The slowdown in auto sales is a concern and the sector needs to be revitalised. We have seen consecutively 9 months of declining sales which also lead to loss of jobs rather than creating jobs," he told reporters on the sidelines of a CII function here.
The Heavy Industry Ministry has taken up the issue with Finance Ministry. "We have been talking to the Finance Ministry... But they also have concerns because of the huge Current Account Deficit (CAD). Therefore, we do not wish to state except the fact that at least in some manner, some kind of incentive should be given as a stimulus package to the auto sector. So let us see, we are in talks," Patel said. Also Read: Ownership cost of automobiles to go up: SIAM Car sales in the country fell for record nine month in a row in July, declining 7.4 per cent, as the economic slowdown and low consumer sentiment hit demand. Vehicle sales across all categories dropped 2.08 per cent to 14,15,102 units in July 2013 from 14,45,112 units a year earlier. It has prompted the Society of Indian Automobile Manufacturers (SIAM) to seek a stimulus package for the automobile sector from the government. SIAM is looking at a package similar to one given during the 2008-09 downturn, in which excise duty on two-wheelers, small cars and commercial vehicles was reduced to 8 per cent. The automobile industry is one of the largest employers and contributes almost 25 per cent of manufacturing GDP. Further, Patel said, the way entire food security is important in India, equally important is the need to grow it because the population is also increasing. This will require more manufacturing at every level which will have an impact on environment also. "Therefore, we need to incorporate best (green) practices in manufacturing sector which are prevalent across the world," he said. Yesterday, Lok Sabha passed the Food Security Bill after considering all the amendments. The bill seeks to provide cheap foodgrains to 82 crore people in the country, ushering in the biggest programme in the world, to fight hunger. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
