Govt working on steps to revive auto industry

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"We are conscious that we need to respond", Sitharaman said, adding that the goods and services (GST) Council will decide on cutting goods and services tax on automobiles, which attract a 28% rate now, at its September 20 meeting in Goa.

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".

In other measures, while briefing reporters on the "100 days of initiatives and decisive actions taken by the Government", Sitharaman said the Centre has set up a task force to boost investments in infrastructure projects and was in the process of identifying the sectors which needed funding from the Centre.

For the fiscal so far, passenger vehicle sales has declined by 23.54 percent at 11,09,930 units, commercial vehicles by 19 per cent at 317,061 units and two-wheelers at 15,14,196 units, 14.85 per cent less than past year.

One of the reasons for the slowdown, according to the Finance Minister, was "change in the mindset" of the people, who, she said, are now using cab aggregators like Ola and Uber as well as public modes of transportation.

Addressing a press conference in Chennai, she said, "Automobile sector, in particular, has been affected by several things".

The Finance Minister also assured that a decision on GST rate cut for vehicles will be taken soon.

Finance Minister Nirmala Sitharaman on Tuesday stated that the mindsets of millennial were adversely affecting the automobile industry as they prefer to use radio taxi services instead of buying own vehicle.

On the question of the auto industry asking for a Goods and Services Tax (GST) rate cut from 28% to 18%, she said, "I can not singularly take a decision on GST".

Automobile industry in India has been reeling under crisis due to dip in sales in recent months.

She said the sector has been impacted by a number of factors.

Also she lifted the ban on purchase of vehicles by government departments and allowed additional 15 per cent depreciation on vehicles acquired till March 2020. Pointing out that it's part of the growth cycle, the FM said, "I am not going to harp on the earlier times when it has happened".

She also defended the bank mergers and said the effective dates for mergers should be decided by the bank boards. "Our full focus now is on how it will rise".

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