In a later statement on social media platform X, Gadkari clarified that the government is not actively considering such a proposal.
“I urge the industry to decrease the production of diesel vehicles; otherwise, imposing an additional tax will become necessary,” Gadkari said. “If you don’t reduce, we will have to increase taxes to a level where it becomes challenging to sell diesel vehicles.”
Since the deregulation of diesel prices in 2014, sales of diesel vehicles in the Indian market have declined. In the previous fiscal year, only 18% of all passenger vehicles sold in the local market were powered by diesel, down from 53% in FY14.
“After 2014, the number of diesel vehicles reduced from 52% to 18%,” Gadkari stated. “Now that the automobile industry is growing, we must prevent the increase of diesel vehicles. It’s your decision whether to reduce diesel vehicle production. If it doesn’t happen, I will recommend a 10% additional tax on diesel to the Finance Minister due to its significant pollution impact.”
Gadkari emphasized that the automobile industry should prioritize the transition to electric and bio-fuels to combat vehicle pollution and reduce crude imports.
However, imposing a 10% indirect tax on such vehicles could negatively impact the automobile industry’s sales since commercial vehicles in India predominantly run on diesel. “Any additional tax will affect our sales,” stated M&M, one of the major automakers. Following Gadkari’s comments at the convention, the share prices of M&M, Tata Motors, and Maruti Suzuki experienced losses of 2.38%, 2%, and 0.8% respectively, as of 12:00 pm.
Gadkari has previously expressed concerns about the drawbacks of diesel vehicles. In 2021, he called for vehicle manufacturers to discourage the production and sale of diesel-engine vehicles and urged them to support alternative technologies.
In May, the Energy Transition Advisory Committee recommended banning diesel-powered four-wheelers in all cities with a population of one million or more by 2027. The committee, led by former petroleum secretary Tarun Kapoor and consisting of executives from state-run oil companies and an oil ministry official, proposed this measure to accelerate India’s energy transition.
Denial of responsibility! Vigour Times is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
