Prime Minister Manmohan Singh makes a promise that he will ask Reserve Bank of India to make credit cheaper for car companies that are badly hit by the recession.
Commenting on the situation, Mr. Sontosh Mohan Dev, Heavy Industry Minister said, “I have told the Prime Minister about the liquidity crisis being faced by the automobile industry. They are facing problems in obtaining loans for their working capital requirements.” He also added, “The PM will discuss the matter with the RBI governor. We are hopeful that some measures will be announced soon to generate consumer demand and save the industry.”
Several auto majors have been affected by the credit crunch and impacts the global recession. India is considered to be an auto manufacturing hub and also the home of various car manufacturers like the Ford, Tata, and the Suzuki. As a result of the present crisis, it has become very essential to search out measures that would support the auto market in the country.
The heavy industry minister also had requested the PM to remove the additional excise duty that was imposed in June. This excise duty was detrimental to the auto sector. In response to the request, the excise duty has been reduced recently.
Still, various other measures also need to be taken into consideration to help the auto sector in India.