The Interim Budget 2019-20 is a document prepared with an eye on the country's economic growth trajectory.
The focus on robust infrastructure, along with rural electrification, is a welcome move. It will have a long-term positive impact on the automobile sector. I laud and share the government's vision for a revolution in the transport sector through electric vehicles and energy storage devices to bring down import dependency.
Transformations in transport sector
India is the fastest highways developer in the world, with 27 km of highways being constructed every day. Giving due importance to the infrastructure sector, there has been a move to usher in transformative changes for next-gen passenger and freight mobility, and infrastructural development for rail, sea, urban transport and inland waterways. This is a positive step in the right direction.
Construction of rural roads has tripled under the Pradhan Mantri Gram Sadak Yojana (PMGSY) and 15.8 lakh out of total 17.84 lakh habitations are already connected. This year's enhanced allocation of Rs 19,000 crore from Rs 15,500 under the PMGSY initiative will go a long way in connecting remote India via rural road network. The push to develop the rural economy will also benefit the manufacturers of farm equipment and off-highway vehicles (OHVs) like construction equipment manufacturers.
Revving up research and development
I have always stressed upon the importance of research and development to serve as a growth propeller. The announcement of a National Centre for Artificial Intelligence as a hub along with Centres of Excellence, with nine priority areas already identified, is an admirable step forward. This will enable us to harness the minds of the youth and create forward-thinking disruptive technologies that will eventually back growth.
At a time when global giants are seriously considering India for setting up advanced industrial artificial intelligence research and development centres, I look forward to this initiative giving wings to industry at large, startups, efforts to generate employment and the education sector.
Reducing the tax burden
Finally, income tax exemptions augur well for the automobile industry. The current income tax structure has been raised to exempt income up to Rs 5 lakh. This is likely to support consumer demand and increase purchasing power of individuals, which is good news for automakers who saw a slump in sales last year.
All in all, this is a positive budget for the country.
(The author is the Chairman of SONA Group)