India’s auto industry will get a $4bn boost from government funding
New Delhi, July 11 (Reuters) – India’s carmakers will get more than $4 billion of government funding from the government this year to boost the country’s auto sector, a government official said on Thursday.
India has been grappling with an economic crisis, which has seen the country hit by a crippling power crisis and its largest bank collapse.
The government will invest up to $3 billion in the car industry this year, the official, who declined to be identified, told Reuters.
The investment comes in addition to a total $4.5 billion investment by the state government last year to promote the auto industry, the government said.
The $3.2 billion will go to two new carmakers, Tata Motors and Mahindra & Mahindras, as well as to four carmakers and to four dealerships, it added.
“These investments will help strengthen India’s industry, boost jobs and improve the quality of life for Indians,” the official said.
Ahead of the budget, the Indian Automobile Manufacturers Association said the government should invest more in the auto sector.
It is “not appropriate for the government to invest only in the sector where it has a monopoly,” the association’s president N. Sudarshan said.
“We also have a demand for more affordable cars, better quality of service, more vehicles, and better quality and safety standards for the consumers.”(Reporting by S. Subrahmanyam; Editing by John Stonestreet)