Money Control

Indian EV makers to not be subsidy dependent; 8.5% return on InvIT model: Nitin Gadkari

A day after Finance Minister Nirmala Sitharaman unveiled Budget 2023, Road Transport & Highways Minister Nitin Gadkari said that there will be a number of electric vehicle makers in India that the price of lithium ion batteries will come down and the industry will not need any subsidy.

“We have 400 startups who are making electric scooters now in India and all are now doing good business. As the number is increasing, the cost of lithium-ion batteries is going to reduce, which is why I feel that the industry doesn’t need subsidy,” Gadkari said in an exclusive interview with CNBC-TV18.

India is the third largest auto market globally, the minister said. “Automobile industry is giving 4.5 crore jobs and giving maximum revenue as a form of GST to the central and state government,” he said.

The Union minister added that the government’s focus is to increase exports and reduce imports. The daily construction target is 45 kms of road everyday and by the end of December 2024, the toll income will be Rs 1.40 lakh crore, according to the minister.

Gadkari also spoke about the Infrastructure Investment Trust (InvIT) model and how it is supposed to be the best, with a return of 8.5 percent. By December 2023, the allocation is supposed to be over.

“Now, it is my intention that we want investment not from the big group, not from the foreign investor, but the people like you who are journalists, the salary and people, the pensioners, we are giving them 8.5 percent returns per year and we are going to add their interest every month in their account. For the deposit in the bank, the interest rate is maximum 5.5, we are giving 8.5,” Gadkari told CNBC-TV18.

The road transport and highways ministry (MoRTH) has received a push with the Budget 2023 raising the allocation by 36 percent to around Rs 2.7 lakh crore for 2023-24. This is nearly 10 percent jump over the Budgetary allocation of Rs 1.99 lakh crore made in the Budget for 2022-23.

Higher budgetary allocations were necessary to help the ministry meet the 25,000-km road development target announced by the government in the 2022-23 Budget, amid rising interest expenses and increasing land acquisition costs.

Out of the total Rs 2.7 lakh crore, the National Highways Authority of India (NHAI) has been allocated around Rs 1.62 lakh crore as part of MoRTH’s capital expenditure plan for 2023-24, a 21 percent increase compared to 2022-2023, when it was allocated Rs 1.34 lakh crore.

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