GST Rate Cut on Vehicles to Boost Growth, Says SIAM

The recent reduction in GST rates on automobiles is expected to accelerate growth in the Indian automotive sector by making vehicles more affordable, the Society of Indian Automobile Manufacturers (SIAM) said on Thursday.

Addressing SIAM’s annual convention, President Shailesh Chandra welcomed the government’s move, noting that procedural amendments alongside the GST cuts would also support the ease of doing business.

“The automobile industry is immensely grateful to the Government of India for this landmark decision. Reduced GST rates will bring renewed cheer to consumers and inject fresh growth momentum into the sector,” Chandra said.

He added that the move would particularly benefit first-time buyers and middle-income families, making entry-level vehicles more accessible and enabling broader access to personal mobility.

Reflecting on industry performance, Chandra highlighted that the passenger vehicle segment recorded its highest-ever sales of 4.3 million units, registering a 2 per cent growth over the previous year. Exports reached an all-time high of 7.7 lakh units, marking a 14.6 per cent year-on-year increase.

The two-wheeler segment continued its recovery, with sales reaching 19.6 million units, growing 9.1 per cent, although still below the previous peak of 21 million units recorded in FY19.

Chandra reiterated his appreciation for the government’s procedural amendments, emphasizing that these measures would further ease business operations and support sustained growth in the sector.

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