Budget 2025: What Indian automakers expect from government this year
What's the story
The auto industry is eagerly looking forward to the Budget 2025, especially for electric vehicles (EVs) and clean energy initiatives.
Industry experts hope the government will extend support in three key areas: development of the EV supply chain, improvement of charging infrastructure, and stimulation of rural demand.
The industry is particularly interested in direct incentives or schemes to boost the EV supply chain, especially battery manufacturing.
Domestic growth
Auto sector eyes domestic battery production boost
The auto industry's main objective is to boost domestic value addition in battery manufacturing to 50-60%.
This would help reduce dependence on imports, possibly aiding battery makers such as Exide Industries and Amara Raja Batteries.
The industry also expects greater government investment in charging stations and energy storage systems, which are essential for the shift to green mobility.
R&D funding
Industry seeks support for clean energy R&D
The auto sector is also hoping for more government support for R&D in clean energy, semiconductors, and EV technology.
A move like this could benefit Bajaj Auto, TVS Motor, Ola Electric, , Mahindra & Mahindra (M&M), and JBM Auto.
These companies are leading India's shift toward green mobility and would greatly benefit from more R&D funding in these areas.
Rural impact
Rural development schemes could boost vehicle demand
The auto industry is also hopeful that the Budget 2025 will have higher allocations for rural development schemes.
This could boost demand for entry-level vehicles, benefiting companies like Hero MotoCorp in the two-wheeler segment and Maruti Suzuki in the four-wheeler market.
For the tractor segment, Escorts Kubota and M&M are likely to gain if these rural development schemes get more funding.