Government reviewing its stance on combustion engine ban: Rajiv Bajaj
Bajaj Auto MD cites officials from Niti Aayog, govt ministries to allay blanket ban fears.
Moreover, there is a “serious consideration” by the government to reduce GST on vehicles to stimulate demand amidst the ongoing sales slowdown in the market, Bajaj said. Currently, vehicles are taxed under the highest bracket of 28% and additional cess of up to 22% is levied, depending on the type of the vehicle.
Bajaj said he met the top officials at the ministries of road transport and highways, heavy industries and public enterprises, and power, as well as at the Niti Aayog and that “they have all unconditionally assured that the government is not going to ban” the said classes of vehicles. “They are not looking at a ban, they are only looking for a phased transition to electric vehicles,” Bajaj said.
The Niti Aayog had mooted the idea to ban all three-wheelers with combustion engines by 2023 and two-wheelers up to 150cc engine capacity by 2025 to promote electric vehicles in an effort to combat rising levels of air pollution and India’s growing crude import bill.
Responding to ET's query on the development, Amitabh Kant, chief executive of Niti Aayog, said, “We are clear about our goals and the targets we want to achieve. We want to do this in partnership with the private sector."
The government has done everything possible to provide impetus to electric vehicles in India, he said, and that it is now for the private sector to do its bit. "They must now take a leadership position in becoming champions of clean mobility.”
This comes as a respite for the automobile industry which had come together and raised concerns that the proposed deadline was too short to recover the heavy investment that has been made in the planned transition to more stringent BS-VI emission norms, which kick in from April 2020. Industry stakeholders such as Rajiv Bajaj and Venu Srinivasan, chairman of TVS Motor Company, were openly critical of the plan and said that such a move could “derail” automobile manufacturing in India.
At a meeting with the Society of Indian Automobile Manufacturers (SIAM), an industry body last month, the government had asked the industry to suggest an alternative roadmap for the transition to electric vehicles instead of the proposed ban.
“We are awaiting the road map that the industry is supposed to submit,’’ Kant said. "We have become a fully importing nation in mobiles, telecom equipment, fab and solar photovoltaic cells because of wrong policies pursued earlier. We will never allow this to happen in the case of electric vehicles. We will build the necessary size and scale and pursue Make in India for both domestic and export markets. We will make India a hub for global markets.”