Citing Q2 growth of 7.6 per cent in FY24, the Union finance minister said the country had the most significant growth making it the fastest-growing economy.
To combat the rising levels of air pollution, Union Transport Minister Nitin Gadkari today suggested a 10% GST increase on diesel cars and generators.
The Union minister warned automakers that following the proposed “pollution tax,” it would be “difficult” to sell diesel vehicles.
Following Mr. Gadkari’s remarks, the shares of Tata Motors, Mahindra & Mahindra, and Ashok Leyland all decreased by 2.5% to 4%.
“Bid adieu to diesel… Please cease producing them, since doing so would only result in a tax hike that would make it harder to sell diesel vehicles, Mr. Gadkari said in a speech at the 63rd Annual SIAM convention in New Delhi.
Later today, the minister will send a letter to Nirmala Sitharama, the Union Finance Minister, recommending an additional 10% GST be imposed on diesel-powered cars and generators.
The minister referred to diesel as a “hazardous fuel” and claimed that because of India’s dependence on imported fuel due to increased demand. Additionally, Mr. Gadkari urged automakers to refocus their production on eco-friendly fuels like ethanol and green hydrogen, a move that would make it easier to introduce more electric vehicles onto Indian roads.
He claimed that as a result of automakers like Maruti Suzuki and Honda ceasing production of diesel passenger vehicles, the number of diesel cars has substantially decreased. Diesel vehicles, which make up the majority of commercial vehicles in the nation, are anticipated to see a steep increase in price as a result of the decision.