The Government is not planning to ban petrol and diesel vehicle, said Union Transport Minister Nitin Gadkari. The auto industry battles its worst slowdown in several years that has led to several carmakers announcing plant shutdowns to cut production. The government is also trying to bring a vehicle scrappage policy soon, he added. On Thursday transport minister also said, the government is also considering a cut in the goods and services tax (GST) rate on hybrid vehicles.
The government’s plan comes as the auto sector battles with a steep drop in sales due to feeble consumer demand, with several top automakers and component manufacturers cutting production.
The government department has allowed buying new vehicles, automobiles purchased till March 31, 2020, to avail the benefit of additional depreciation of 15 per cent, with total depreciation up to 30 per cent, and BS-IV vehicles bought till March 31, 2020, would remain operational for their entire registration period.
“In the economy, auto sales have also been hurt due to the lingering crisis in the NBFC sector. The automakers should consider starting non-banking finance companies for lending to buyers to boost sales,” said Gadkari.
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