Automobile & EV market reactions on Budget 2022-23: As Finance Minister Nirmala Sitharaman on Tuesday made an announcement outlining the economic growth for India over the next 25 years.
Here’s what the Automobile & EV sector experts are saying about the Union Budget 2022:
Anup Patil, CEO, Intangles Lab Pvt. Ltd:
One of the key highlights for the automotive sector in the Budget 2022 speech was the announcement of a new Battery Swapping Policy. This policy being brought out along with interoperability standards will provide a much needed boost to the EV ecosystem. Also the opening up of defense R&D to private companies will benefit electric commercial vehicle makers and auto component players considerably. The private sector will be encouraged to create sustainable and innovative business models for battery and energy as a service, improving the efficiency in the EV ecosystem’.
Sameer Aggarwal, Founder and CEO, RevFin:
A policy on battery swapping will help in wide scale adoption of batteries as a service. This will reduce upfront ownership costs of electric vehicles and link that cost to vehicle running. Since the cost of running electric vehicles is cheaper, the overall running cost with battery service will work out to be more economical than usage of ICE based vehicles. This is a very welcome announcement in the union budget. This will also create opportunities for several new startups.
Zero emission zones in cities will help bring prominence to electric vehicles as well as provide incentive to purchase electric vehicles to be able to use those zones.
The biggest let down in the budget was that there were no specific announcements for financing of electric vehicles. Lack of financing is the single biggest blocker for EV adoption. Categorisation of EV financing as priority sector lending or creation of a specific fund for EV financing is much needed and unfortunately missing from today’s budget speech.
Akshit Bansal, Co-Founder of Statiq:
“The Union Budget 2022-23 has made a strong case for clean energy and environment by supporting the EV charging segment and according us the freedom to re-evaluate ways for promoting ease of charging EVs with low-cost renewable energy (RE) systems. Pairing EV charging with RE structure has resulted in the positive development of the economics of adoption of both factors. By broaching the guidelines in the speech, the Ministry of Power has opened the gates for discussion and investment in favour of public EV charging stations, by prescribing a timetable for open access applications and the applicable fees. And for that we, as a sunrise sector and as a nation, are extremely grateful.”
Amit Gupta, Co-founder & CEO, gogoBus:
Taking up the ‘Holistic Infrastructure’ focused approach under PM Gati Shakti Master Plan is a welcome move. Our honorable finance minister Nirmala Sitharaman Ji has set the right context for the revival of the road-mobility industry, which got severely impacted due to the pandemic. In these difficult times, focusing on productivity, climate action, financing, and investments under this scheme is going to provide sustenance to this already struggling industry. Also, the focus of the government for the enhancement of the National Highway network by another 15% is astoundingly motivating. Both these announcements are encouraging, especially for the shared road-mobility industry, which is sustainable and contributes positively towards the environment.
The EV sector received a boost with cities being encouraged to introduce zero-fossil fuel policies and urban residents encouraged to increase ridership on public transport and use of electric mobility. The private sector has been encouraged to build business models for battery-as-a-service. To encourage use of EVs, battery swapping and charging infrastructure will be scaled up and interoperability standards formulated. The steps will go a long way in promoting EV sales in the country.
Vimal Singh, Founder & CEO, ReadyAssist:
Government’s thought leadership level act on the policies for bringing EV battery swapping interoperability is a brilliant move. This could push the adoptability of EV to 10X and also gives opportunities of collaboration between vehicle manufacturers and battery/service technology providers to enter in the space of BaaS (Battery as a Service).
While the government is doing everything best possible to boost the economy and bring financial inclusion to all, I think the government should consider waiving off the GST for services which are below 500 Rs. This would benefit the whole country in multi folds; 1. People will not be burdened with taxes for essential services, 2. Prices for certain services can go down as every service provider would try to fit in the less than 500 bracket, 3. Since the services below 500rs are exempted from GST, every service provider would be inclined to account the transaction digitally than offline cash and hence financially included, 4. Help startup like us to bring standardisation in the ecosystem”.
Prashant Kumar, Co-Founder & CEO, Zingbus:
The financial budget promises to prioritize clean energy resources for eco-friendly mobility. This step will help us build environment-friendly transportation with the introduction of EVs and more. The highway expansion project of 25,000 km will lead us to proper connectivity boosting the travel network. Implementation of the multimodal logistic parks at 4 locations in 2022-23 in PPP mode will lead to various ventures helping the sector intensively.
Mridu Mahendra Das, Co-founder and CEO, Automovill:
The Budget just refueled the ongoing initiative with the announcement of battery swapping policy, and charging stations setup plan. The battery swapping policy will enable adoption of battery as a service. This is also expected to reduce the running cost of the vehicle. With the increasing adoption of EV there is a need for simultaneous strengthening of the support infrastructure. Like new-age auto tech -service startups are upskilling and reskilling internally to support the maintenance end of it. As we have already launched India’s first learning management system for bridging the gap between skilled,semi-skilled workforce across the country in line with government vision.
However, any sort of mismatch in manufacturing and post sales requirements like charging infrastructure absence would have taken away the steam of the ultimate aim of eMobility mission. Not just auto manufacturers, even auto service players will benefit from this budget.
Shubhankar Chaudhry, CEO, One Moto India:
Almost all the auto giants in India have stepped into EV manufacturing further to the launch of the e-mobility mission. In fact, a number of startups have also launched electric vehicles to leverage the shifting focus towards EVs over ICE. However, creating a balance between supply and adoption was a long-stalling challenge for every player. Imagine, when the consumer is ready to buy an EV but gets hesitant due to the absence of charging infrastructure. This could not have been achieved without ample government support towards creating the right infrastructure and fueling the adoption at consumers’ end. State governments have been launching policies and subsidies to accelerate the adoption at their end.
Now with the Budget announcement of battery swapping policy, and charging stations at a scale, there is hope that we will soon have a robust system to support the increasing adoption of EVs on road.
As the Budget rightly mentioned, Make In India shall create 6 million New Jobs, and all of us in the industry are dedicated towards accomplishing the same. We welcome this move by the central govt to achieve the “panchamrit” vision of the Hon’ble Prime minister.