Nirmala Sitharaman asks Congress to speak in one voice on Kashmir

Government Will Respond To Demand Of Auto Industry Finance Minister

Sitharaman was addressing the media in Chennai on NDA government completing 100 days of its second term.

When asked about a possible rate cut on cars, Sitharaman said that call would be taken by the GST Council at its meeting in Goa next week. The industry saw a 12.25% decline in production in April-August 2019 compared to previous year.

Responding to concerns about the rising gold prices and whether the government would move to control the rise, the Minister said, "we don't have the yellow metal in our country, we depend on importing it. The automobile sector is affected by a range of issues such as rollout of Bharat Stage VI emission standard, higher registration fee, the mindset of millennials who prefer to use ride-hailing services such as Ola and Uber over committing to an EMI for purchasing a vehicle, besides the use of public transport such as metro".

In an effort to arrest the slowdown in the economy, Sitharaman met representatives of several industries in July to understand the challenges faced by them.

"The automobile industry in India did have its good time, at least till two years ago". Overall passenger vehicle sales dropped by a significant 31.57 per cent last month with 196,524 units sold compared to 287,198 units in August 2018.

Automobile sales witnessed its worst-ever drop in August across categories, with passenger auto sales falling by as much as 41.09 per cent, according to data released by industry body SIAM.

The sector slowdown has led to companies resorting to production cuts even as many dealers have laid off employees or shut shop themselves. 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. This is down from a GDP growth of 8.2% in the first quarter of the previous financial year.

Responding to the criticism of the government accessing the accumulated reserves of the Reserve Bank of India, she said it had been accessed by the governments in the past too. Dips and rise in GDP growth do happen, but we are not sitting without responding to boost it.

While stating that bank mergers were announced for the banks to benefit from each other, the FM said the date of merger had to be decided by the boards of respective banks.

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