The Union Budget 2024 has rolled out several key measures to boost economic growth and sustainability in India. This year’s budget focuses on reducing costs in important areas, addressing skill shortages, and supporting sustainable development goals.
A standout feature is the exemption of customs duties on crucial minerals like lithium and cobalt. This change is set to lower the cost of making electric vehicle (EV) batteries, making EVs more affordable for consumers. The budget also supports improvements in infrastructure and workforce skills, particularly in the EV sector.
The budget has received positive feedback from leaders in the EV and green mobility sectors, who agree that these changes will significantly benefit the industry.
Mr. Pratik Kamdar, CEO & Co-Founder of Neuron Energy, praised the decision to exempt custom duties on critical minerals like lithium and cobalt, highlighting its potential to reduce battery cell production costs significantly. This move is expected to lower the overall cost of EV batteries, making electric vehicles more affordable and supporting India’s commitment to sustainable mobility solutions.
Mr. Ravi Machani, Co-Founder and Investor at Tresa Motors, lauded the budget’s emphasis on upskilling. He noted the importance of bridging the skills gap in battery technology and power electronics to meet the growing demand for expertise in the EV industry. The government’s initiative to upskill students over the next five years is seen as crucial for driving innovation and sustainability in the sector.
Ms. Rashi Agarwal, Co-Founder and CBO of Zypp Electric, welcomed the budget’s focus on increasing women’s workforce participation and youth skilling, which she believes will enhance workforce skills and employability. She also highlighted the importance of policy consistency and expressed anticipation for announcements on the FAME-III policy and special incentives for the EV sector. The abolition of the angel tax was recognized as a positive step for fostering innovation and supporting the start-up ecosystem.
Hari Kiran, COO & Co-founder of eBikeGo, expressed enthusiasm about the budget’s provisions, including the waiver of import duties on crucial minerals like lithium. He emphasized how this will lower manufacturing costs and enhance affordability for consumers. Additionally, the investment in industrial training centers is expected to create a specialized workforce and support the growth of sustainable transportation solutions.
Kaustubh Dhonde, Founder and CEO of AutoNxt Automation, appreciated the waiver of import duties on 25 minerals, including lithium. This policy change is anticipated to reduce raw material costs in EV manufacturing, ultimately making electric vehicles more accessible to consumers and supporting the sector’s growth.
Mukesh Taneja, CEO and Co-Founder of GT FORCE, acknowledged the budget’s support for MSMEs through credit guarantee schemes and investments in industrial training centers. However, he noted the absence of increased budgetary allocation for expanding EV charging infrastructure, which he believes is essential for boosting consumer confidence in electric mobility.
Dr. Sudhir Mehta, Founder and Chairman of EKA Mobility and Pinnacle Industries, highlighted the budget’s role in advancing India’s economic goals and supporting various sectors. The introduction of a credit guarantee scheme for MSMEs, the reduction in the turnover threshold for the TReDS platform, and the abolition of the angel tax were seen as significant steps in fostering innovation and supporting start-ups. The allocation for rural development and climate-resilient crop varieties was also recognized as a forward-thinking strategy for sustainable agriculture.
Devndra Chawla, MD & CEO, GreenCell Mobility, applauds the Union Budget under Modi 3.0 for advancing infrastructure development and sustainable transportation. The budget’s focus on industrial parks and the Rs 26,000 crore investment in road infrastructure aligns with the vision of “Viksit Bharat.” These measures are expected to drive economic growth and improve quality of life by easing commutes and reducing travel times. Additionally, the creation of a climate finance taxonomy will enhance capital availability for climate adaptation and mitigation, supporting India’s green transition. The government’s efforts to enhance tourism infrastructure through state-level marketing and a new rating system for tourist centers are commendable. The reduction in tax slabs under the New Tax Regime will boost disposable income and encourage the use of eco-friendly transportation options like our NueGo service.
The budget’s focus on reducing the cost of essential materials for battery production is a strategic step to make EVs more economically viable. By alleviating the financial burden on manufacturers, the government is fostering a more competitive market environment that could accelerate the adoption of electric vehicles. Furthermore, the investment in industrial training centers reflects a recognition of the need for a skilled workforce to support the growing demands of the EV industry. These training centers will play a crucial role in bridging the skills gap and preparing the next generation of workers for roles in battery technology and power electronics.
Additionally, the budget’s provisions to support MSMEs through credit guarantee schemes and the reduction of the turnover threshold for mandatory onboarding on the TReDS platform are designed to bolster small and medium-sized enterprises. These measures are expected to enhance the financial stability of MSMEs, facilitating easier access to term loans and promoting wider participation in online financial platforms.
The budget signals a strategic alignment with the broader goals of sustainable development and economic inclusivity. By prioritizing the reduction of import duties on critical minerals and investing in skills development, the government is not only addressing immediate industry needs but also laying the groundwork for long-term growth. The emphasis on infrastructure development, including road connectivity and climate finance taxonomy, supports the vision of a more connected and environmentally conscious India.
The reduction in tax slabs is anticipated to boost disposable income, potentially driving higher consumer spending on travel and exploration, which could benefit the tourism sector. However, while the focus on EVs and infrastructure is commendable, there is a notable absence of specific incentives for EV charging infrastructure, which remains a critical component for enhancing consumer confidence in electric mobility.
Despite these positive measures, several challenges remain. The lack of increased budgetary allocation for EV charging infrastructure could hinder the growth of electric mobility by limiting the accessibility of charging stations. Additionally, while the focus on skills development is vital, ensuring that these training programs align with industry needs and provide relevant, up-to-date education will be crucial. There is also a need for policy consistency to sustain momentum and support the expansion of the electric vehicle market.
Overall, the Union Budget 2024 presents a balanced approach to promoting sustainable development and economic growth. By addressing critical areas such as battery production costs, workforce skills, and infrastructure, the budget lays a strong foundation for India’s progress towards a greener and more prosperous future. However, continued focus on specific challenges, such as EV charging infrastructure and policy consistency, will be essential to achieving the full potential of these initiatives.
