The Finance Minister has unveiled a well-thought-out budget anchored by six key pillars. This could set out a virtuous cycle for growth and job creation, propped up by a a thrust on public investment in infrastructure and health. The key will be in effective implementation, according to Vipin Sondhi, MD & CEO, Ashok Leyland.
"The Union Budget 2021 has several positive signals for the manufacturing sector and Commercial Vehicles (CV), which are core to the economy," said Sondhi, while mentioning four specific areas that he feels could provide the much needed demand impetus to the CV sector.
The first of these is the commitment to augment the country's road infrastructure with projects for building 8,500 km of highways and economic corridors augurs well for surface and road transport, he explained.
Secondly, an Rs 18,000-crore scheme to augment public transport in urban areas with the addition of 20,000 new buses in a PPP model would ensure cleaner and efficient public transportation and ease congestion.
Thirdly, the assurance of implementing a voluntary scrappage policy, for 20 years for personal vehicles and 15 years for commercial vehicles is positive.
"This is good for the environment and good for setting in motion a circular economy. However, we await further details of the policy, as the industry had requested for an incentive based Scrappage policy for it to be effective," said Sondhi.
Lastly, the emphasis on rejuvenating the manufacturing sector with double-digit sustainable growth is reassuring as manufacturing would be a big job creator, he said, adding that the thrust on R&D for National Priority Projects and the PLI scheme will be key enablers to attain the Prime Minister’s vision for Atmanirbharta in the Manufacturing sector.
"Overall the budget presented during these difficult times has laid emphasis on increasing economic activity and is a step in the right direction for renewed economic resurgence," said Sondhi.