New National Auto Policy to be finalised soon

The Heavy Industry Ministry has been in discussion with various stakeholders over the last six months for framing a new national auto policy, which is expected in the next three months. The aim is to have a single, all-encompassing regulatory body for the automobile industry.

At the moment, there are various grey areas and overlaps in the field of automotive standards and homologation, with the Ministry of Road Transport and Highways and the Ministry of Heavy Industries both being involved.

Other key elements of the policy include the possible introduction of emission-based taxation. Currently, the GST structure for automobiles is based on length, engine displacement and type, and ground clearance. This present-day system is expected to be replaced by a composite criteria revolving around vehicle length and CO₂ emissions. This is aimed at promoting green mobility and reducing Green House Gas emissions.

Along the same lines, the policy hopes to strengthen the FAME (Faster Adoption and Manufacturing of Electric and Hybrid Vehicles) scheme in India, thereby promoting electric and hybrid vehicles. Long-term emission targets are being laid down, with a definite timeline.

Another area being attacked are the industry standards for various components being used by OEMs as well as aftermarket manufacturers. This process is also expected to be brought under a common system, giving more clarity.  

Finally, the policy is also expected to ease the logistics challenges faced by the Indian auto industry, while simultaneously enhancing India’s auto exports.

Overall, there seems to be a clear and concise direction being implemented, with comprehensive guidelines and timelines being put in place. This should bring some lucidity and solidarity to the Indian auto industry that has so far been missing.