Rs 20-lakh cr economic package to boost demand, growth once again: SIAM

The Rs 20-lakh crore economic package announced by Prime Minister Narendra Modi will provide boost to demand and growth of India's economy once again, auto industry body SIAM said on Tuesday.

The Society of Indian Automobile Manufacturers (SIAM) also hoped that a focused package to support the Indian automotive industry would be announced by Finance Minister Nirmala Sitharaman, when she announces the details of the package.

"India has delivered in the fight against COVID-19 on the medical front. Now, the promise of Rs 20 lakh crore comprehensive economic package announced by the Hon'ble Prime Minister, focusing on economic activities and an overall aim of a self-reliant India, will provide the right boost to demand and growth of our economy once again," SIAM President Rajan Wadhera said in a statement.

Drawing attention to the Indian automotive industry, he said the sector is "a strong pillar of Make in India with huge contributions to GDP (gross domestic product) and employment and relies on its highly indiginised supply chain".

"We are hopeful that a focused package to support the Indian automotive industry would be announced by the Hon'ble finance minister, when she announces the details of the package," Wadhera said.

With the auto sector suffering one of the longest slowdowns in the past one year followed by the impact of the coronavirus pandemic, SIAM has been seeking government support to help the industry.

It has called for reduction in goods and services tax (GST) on automobiles and bringing the scrappage policy among others to help spur demand.

In his address to the nation, Modi said the special economic package will amount to Rs 20 lakh crore that is nearly 10 per cent of GDP. It is for "labourers, farmers, honest tax payers, MSMEs and cottage industry".