Millennials preferring Ola, Uber adversely affecting auto industry: Nirmala Sitharaman

Marco Green
September 11, 2019

She listed out switch over to BS VI emission norms and registration fee related matter (which the government postponed later) as reasons for the auto sector slowdown.

Domestic passenger vehicle sales fell for the 10th consecutive month, registering a 31.57% decline. Facing its worst decline in sales since 1997-98, the automobile sector has been clamouring for measures to rejuvenate demand, including relaxation in GST rates.

When asked about the slowdown in auto sector, which is said to be the worst in almost two decades, the finance minister said, "It is true that the automobile sector in India had a good time till two years ago, there was definitely a good upward trajectory for automobile sector".

Last month, the government announced several steps, including mandating government agencies and departments to replace old vehicles, increasing depreciation on new vehicles for commercial fleet service providers, urging banks to make auto loans cheaper, and increase credit availability to non-bank lenders, to boost demand.

"The banks will benefit from each other's strength".

On the recently announced bank mergers, she said the effective dates of mergers are to be decided by the individual bank boards.

Speaking at a press conference in Chennai, Sitharaman said a dip in the GDP is part of the growth cycle and the government is conscious that it has to respond. This is down from a GDP growth of 8.2% in the first quarter of the previous financial year. "Our full focus now is on how it will rise", she noted. She also hailed India and Russian Federation accord which will open a maritime route between the ports of Chennai and Vladivostok to ensure connectivity between the two countries. She recollected that during the 2016-17 Russian Federation talks, business representatives from the East of Ural mountains states had come to Chennai and representatives from Chennai had reciprocated the visit.

While the Finance Minister did not give any clarity on what the Centre is doing to address the slowdown, she said that the government is talking to the industry to see how best it can help them.

Stating that if the inflation rose along with the fall in growth of the economy, it could have been a cause of concern, the finance minister said that government is working out solutions and taking steps to revive the economy.

Other reports by Click Lancashire

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