NEW DELHI: Finance Minister (FM) Nirmala Sitharaman on Saturday announced the second budget after Narendra Modi led returned to power in 2019. In the Union Budget 2020-21, FM announced a scheme to boost mobile, electronic manufacturing and semi-conductor packaging under the theme of ‘economic development’.
This year’s Union Budget centers around three — Aspirational India, Economic development and Caring Society.
Welcoming the move, Industry leaders expect that it will help EV manufacturing and will encourage newer technologies like connected platforms to mushroom in the Indian auto sector. Apart from attracting FDI investments in the sector.Pawan Goenka, MD, Mahindra & Mahindra, tweeted, “Right areas of thrust for manufacturing – to be part of GVC, attract investment in electronics, focus on quality and facilitate export. Urgent implementation will be the key.”
“The new scheme will promote automotive electronics and semi-conductors manufacturing and assembly to attract foreign investments. It will also aid EV manufacturing in the country” said Kavan Mukhtyar, Partner and Leader, PwCEchoing his views, Vinay Piparsania – Consulting Director Automotive, Counterpoint said, “Plans to encourage manufacturers of mobile phone semi-conductors etc ..will support the development of EV ecosystem and supply chain.”
The scheme has been announced at a time when the Indian auto industry is going through massive transition and standing at an inflection point for electric vehicles. Major automakers have announced their product plans. Apart from this, auto companies have introduced connected vehicle technology.
Gaurav Vangaal, Associate Director, Light Vehicle Production Forecast, said, “Cars are expected to become smart gadgets due to connected cars, & electric cars. The mention of boosting the domestic electronic equipment industry like semiconductor packaging & other components.”
Given the impulse of connected technology in mobile phones and vehicles, FM said that a policy to enable the private sector to build data center parks, soon. This will enhance connectivity and digitisation of the sector and is expected to help automotive in a big way.